European shares traded mostly flat on Friday, as losses in technology and consumer stocks were offset by gains in heavyweight banks. Despite the subdued session, regional markets were on track to close the week with solid gains following a busy period of economic data releases and central bank decisions.
The pan-European STOXX 600 slipped 0.1% to 584.96 by 03:09 GMT, one day after recording its strongest single-day performance in more than three weeks.
Major regional indices also edged lower. Germany’s DAX and the UK’s FTSE 100 both declined 0.1% during early trading.
Most major sectors posted modest losses, led by personal and household goods. German sportswear companies Adidas and Puma fell 0.7% and 2.2%, respectively, after U.S. rival Nike reported a second straight quarterly decline in gross margins.
In contrast, bank stocks gained 0.2%, making them among the top performers on the benchmark index and helping limit broader market losses.
Investor sentiment improved after Thursday’s unexpected slowdown in U.S. consumer price inflation, which reinforced expectations that the Federal Reserve could move toward interest rate cuts in 2026. However, analysts urged caution, warning that the inflation data may have been temporarily distorted by the recent U.S. government shutdown.
Separately, European Union leaders agreed to borrow funds to provide a €90 billion loan to Ukraine over the next two years instead of using frozen Russian assets. The decision pushed German bond yields higher, adding another layer of complexity to market dynamics.
