String of weak earnings leave European stocks barely up on the week
By Sruthi Shankar
(Reuters) - Gloomy earnings reports from French carmaker Renault and food group Danone drove European shares lower on Friday, rounding off a tumultuous week that left investors waiting anxiously for the next twist in the Brexit saga.
The pan-European STOXX 600 index <.STOXX> finished 0.3% lower and Paris-listed shares <.FCHI> lagged the most with a 0.65% decline, hit by weak quarterly results.
The warning pushed the wider auto and auto parts index <.SXAP> to its biggest percentage drop in two-and-a-half weeks, with added pressure from Sweden's Volvo AB
Volvo's shares settled up 2.4% after falling as much as 5% as investors chose to focus on its forecast-beating earnings.
The biggest drag on the main index was an 8.4% decline the shares of Danone
Friday's losses pulled the STOXX 600 lower for a third straight session to end flat on a week dominated by Brexit headlines.
Boris Johnson struck a Brexit deal with the European Union on Thursday, sending the benchmark index to its highest in more than a year, but concerns remain about the deal getting through the British parliament.
"Whatever happens at the weekend it is unlikely to be the end of this saga," Michael Hewson, chief market analyst at CMC Markets, said.
"However, if MPs do hold their noses and vote for the deal, at least we can move on to phase 2 which is negotiating the new relationship over the next 14 month transition period."
After a solid increase in the first quarter, gains in the STOXX 600 index have tapered off in the second and third. Fresh data on Friday showed China's economic growth slowed more than expected in the third quarter.
Investor focus now turns to the third-quarter earnings season, which kicks off in earnest next week. An earnings recession in Europe is expected to deepen in the third quarter, according to IBES data from Refinitiv.
London Stock Exchange (NYSE: LSE) rose 0.8% after reporting a higher-than-expected third-quarter income ahead of the planned shareholder vote on its deal to buy data provider Refinitiv.
Shares in AMS (NYSE: AMS) fell nearly 5% after Bloomberg reported the Austrian sensor maker was planning to discuss a renewed bid for Osram
London-listed shares <.FTSE> were dragged lower by Holiday Inn-owner InterContinental Hotels Group (NYSE: IHG), which fell 4.6% after reporting a fall in third-quarter revenue per room.
(Reporting by Sruthi Shankar in Bengaluru, editing by Louise Heavens)