European Markets Close On Firm Note On Rate Cut Hopes, AI Optimism

(RTTNews) - European markets closed higher on Friday as rising hopes of more interest rate cuts from the Federal Reserve, and optimism surrounding artificial intelligence outweighed concerns about any impact of the government shutdown in the U.S.

Investors also digested the latest batch of economic data from the region, including reports on manufacturing and services sector activity in major European economies.

Shares from financial, mining and energy sectors were among the prominent gainers.

The pan European Stoxx 600 gained 0.5%. The U.K.'s FTSE 100 climbed 0.67%, France's CAC 40 closed up 0.31%, and Germany's DAX drifted down by 0.18%. Switzerland's SMI settled with a gain of 0.64%. The FTSE gained about 2% in the week, while CAC 40 and DAX moved by over 2.5%.

Among other markets in Europe, Belgium, Czech Republic, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Norway, Portugal, Spain and Sweden closed higher.

Russia and Turkiye ended weak, while Poland closed flat.

In the UK market, Bunzl climbed about 4.5%. Natwest Group, Schroders, 3i Group, Spirax Group, Intertek Group, WPP, Diploma, Melrose Industries and Land Securities gained 2 to 4%.

HSBC Holdings, Standard Chartered, Antofagasta, AstraZeneca, Anglo American Plc and Ashtead Group also posted strong gains.

Coca-Cola Europacific Partners, Admiral Group, Coca-Cola HBC, Metlen Energy & Metals, Airtel Africa, GSK, British American Tobacco and Kingfisher lost 1 to 2%.

In Germany, Merck, Rheinmetall, Siemens Healthineers, BASF and Continental ended with sharp gains.

Siemens Energy, Deutsche Boerse, Heidelberg Materials, Bayer, SAP and BMW ended with sharp to moderate losses.

In the French market, Kering and Edenred both ended stronger by about 3.75%. ArcelorMittal, Sanofi, LVMH, Accor and Stellantis gained 1.8 to 2.5%.

Air Liquide, Bouygues and Orange closed sharply lower.

The HCOB Germany Composite PMI was revised lower to 52 in September 2025 from a preliminary of 52.4, but continued to point to the strongest growth in private sector activity since May 2024, compared to 50.5 in August. The services PMI score came in at 51.5, up from 49.3 in August, while the manufacturing PMI came with a 49.5 score, down from 49.8 a month earlier.

Data from Eurostat showed Eurozone producer prices declined for the first time in nine months in August due to the sharp decrease in energy prices.

The producer price index fell 0.6% on a yearly basis, reversing July's 0.2% increase. The index was expected to drop by 0.4%.

Month-on-month, producer prices were down 0.3%, offsetting the 0.3% increase in July. Prices were expected to drop 0.1%.

Data from the statistical office INSEE showed France's industrial production declined unexpectedly in August, falling by 0.7% on a monthly basis, after a revised 0.1% drop in July. Output was forecast to grow 0.3%.

Manufacturing output shrank 1.6%, faster than the 0.5% fall in the previous month.

Data from S&P Global showed the HCOB France Composite PMI slipped to 48.1 in September, below a preliminary 48.4 and down from 49.8 in August, as the private sector contracted for the 13th straight month.

Data from Eurostat showed Eurozone producer prices declined for the first time in nine months in August due to the sharp decrease in energy prices.

The producer price index fell 0.6% on a yearly basis, reversing July's 0.2% increase. The index was expected to drop by 0.4%.

Month-on-month, producer prices were down 0.3%, offsetting the 0.3% increase in July. Prices were expected to drop 0.1%.

The S&P Global UK Composite PMI fell sharply to 50.1 in September 2025 from a preliminary reading of 51 and 53.5 in August, its weakest reading in five months and indicating stagnant private sector activity.

The S&P Global UK Services PMI fell to 50.8 in September, from a more than one-year high of 54.2 in the previous month, revised down from the preliminary estimate of 51.9. This marked the weakest pace of expansion since April, as subdued economic conditions and heightened market uncertainty weighed on output growth.