European Stocks Close Broadly Lower On Recession Fears

(RTTNews) - European stocks closed broadly lower on Friday, weighed down by fears about a global recession, and worries on the political front.

Rising bond yields significantly hurt stocks. U.S. 10-year Treasury yields rose to a new 14-year high of 4.337% amid rising expectations of steep interest rate hikes by the U.S. Federal Reserve.

Remarks from Philadelphia Federal Reserve President Patrick Harker raised concerns about the rate-hike path and the possibility of a recession.

"Given our frankly disappointing lack of progress on curtailing inflation, I expect we will be well above 4 percent by the end of the year," Harker said on Thursday.

In addition to reacting to quarterly earnings updates, investors also digested the latest batch of economic data from the region.

The pan European Stoxx 600 drifted down 0.62%. The U.K.'s FTSE 100 gained 0.37%, Germany's DAX ended 0.29% down, and France's CAC 40 closed lower by 0.85%. Switzerland's SMI dropped 0.52%.

Among other markets in Europe, Austria, Denmark, Iceland, Ireland, Norway, Poland, Spain and Sweden ended weak.

Belgium, Portugal, Russia and Turkiye closed higher, while Czech Republic, Finland, Greece and Netherlands settled flat.

In the UK market, Glencore, Anglo American, Antofagasta and GSK gained 2 to 3.6%.

Endeavour Mining, Rio Tinto, Standard Chartered, Severn Trent, Pershing Square Holdings, HSBC Holdings, Shell and Compass Group advanced 1 to 1.8%.

Auto Trader Group and JD Sports Fashion both tumbled more than 6%. Frasers Group dropped 4%. RightMove, Next, Centrica, B&M European Value Retail, Spirax-Sarco Engineering, Burberry Group, RS Group and IAG shed 2 to 3%.

Intercontinental Hotels Group ended more than 2.5% down after saying Paul Edgecliffe-Johnson will step down as Chief Financial Officer.

In the French market, L'Oreal ended more than 5% down despite posting robust sales growth in the third quarter.

Vivendi ended lower by about 3.5% after saying it will go ahead with the spin off of its publishing business Editis.

Essilor, Kering, Pernod Ricard, Dassault Systemes, Faurecia and Unibail Rodamco lost 2 to 3.5%.

Atos soared 12.5%. ArcelorMittal surged nearly 2.5%. Veolia ended higher by about 1.4%. Sodexo and Sanofi both ended higher by about 1%.

In the German market, Adidas tanked 9% as the sporting goods maker cut its full-year outlook, citing weakening demand.

Puma fell 7.2%. Zalando, RWE, Vonovia, Porsche Automobil, Siemens Healthineers, Henkel, Deutsche Wohnen, Symrise, E.ON, Merck and HeidelbergCement lost 1.4 to 2.8%.

Shares of Swedish telecom operator Telia plunged 12.3% after the company reported slightly worse-than-expected third-quarter net profit and downgraded its guidance.

On the economic front, UK consumer sentiment unexpectedly improved in October despite soaring inflation and political uncertainty, survey results from the market research group GfK showed on Friday.

The consumer confidence index rose to -47 in October from -49 in September. The score was forecast to fall further to -52.0. The September reading was the lowest since the survey began in 1974.

Data from the Office for National Statistics showed retail sales in the U.K. dropped 1.4% month-on-month in September, following a revised 1.7% decline in August. Economists had forecast sales to drop at a slower pace of 0.5%.

On a yearly basis, the decline in retail sales worsened to 6.9% in September from 5.6% in August. Economists had expected sales to fall 5%.

The UK budget deficit reached its second highest September level since the monthly records began in 1993, the Office for National Statistics said. Excluding public sector banks, public sector net borrowing was GBP 20.0 billion in September, which was GBP 2.2 billion more than in September 2021. The expected deficit was GBP 17.1 billion.