European Markets Close Lower As Geopolitical Tensions, Weak Economic Data Hurt Sentiment

(RTTNews) - European markets closed weak on Friday, extending recent losses, as an escalation in Russia-Ukraine tensions hurt sentiment.

Rising possibility of Russia invading Ukraine rendered the mood extremely cautious, and the major markets, despite seeing a spell in positive territory, failed to hold gains and ended on a negative note.

Ukrainian government and Russian state-controlled media continued to exchange accusations of cease-fire violations in the eastern part of the country.

News that Russian Foreign Minister Sergei Lavrov and U.S. Secretary of State Antony Blinken have agreed to meet in Europe next week had eased concerns about an imminent Russian invasion of Ukraine, but investors remained reluctant to make significant moves.

The pan European Stoxx 600 declined 0.81%. The U.K.'s FTSE 100 ended 0.32% down, France's CAC 40 drifted down 0.25% and Germany's DAX tumbled 1.47%. Switzerland's SMI shed 0.54%.

Among other markets in Europe, Austria, Belgium, Denmark, Finland, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain and Sweden ended with sharp to moderate losses.

Czech Republic and Iceland ended modestly lower. Turkey closed on a firm note, while Greece edged up marginally.

In the UK market, Evraz tumbled more than 7%. Aveva Group declined 6.4%, Ocado Group, Flutter Entertainment and Scottish Mortgage shed 4 to 4.4%, and Dechra Pharmaceuticals ended 3.2% down.

Natwest Group ended sharply lower after warning of uncertain economic outlook. IAG, Ashtead Group, Croda International, Prudential and BP also declined sharply.

Standard Chartered climbed 3.8%. Antofagasta, Reckitt Benckiser, Burberry Group, Airtel Africa, Unilever, Imperial Brands, B&M European Retail, Kingfisher, Rio Tinto and National Grid lost 1 to 2.3%.

In the German market, HelloFresh, Zalando and Sartorius lost 4.7 to 5.4%. Allianz ended nearly 4% down after it took a €3.7bn hit to its pre-tax profits.

Infineon Technologies, Porsche Automobil, Continental, SAP, Covestro, Siemens, Volkswagen and Merck ended lower by 2 to 3.3%.

In Paris, Hermes International, Faurecia, Michelin, Air France-KLM, STMicroElectronics, Dassault Systemes and Valeo lost 2 to 4%. Societe Generale, Accor and Technip also declined sharply.

Renault saw some strong buying after it swung to profit in 2021 and announced the appointment of Thierry Piéton as Chief Financial Officer with effect from March 1. However, the stock pared its gains as the session progressed and ended flat.

Teleperformance ended nearly 5% up. Pernod Ricard gained about 2% and LO'real climbed 1.2%. Carrefour, Bouygues and Danone posted modest gains.

Swiss chemicals company Sika AG ended 3% down after confirming its previous target of 6-8% annual growth up to 2023.

Finnish drug manufacturer Orion soared more than 23% after announcing positive trial results for its prostate cancer treatment.

In economic releases, the euro area current account surplus decreased to EUR 23 billion in December from EUR 24 billion in the previous month, the European Central Bank said.

Preliminary data from the European Commission showed Eurozone consumer confidence deteriorated further in February, defying expectations for a modest improvement.

The flash consumer confidence index fell to -8.8 from -8.5 in January. Economists had expected a score of -8.0. The index fell for the fifth month in a row and the latest reading was the weakest since March 2021, when it was -10.9.

Eurozone construction output declined for the second straight month in December, Eurostat reported. Construction output fell at a faster pace of 4% month-on-month in December, following a 0.2% drop in November.

On a yearly basis, construction output fell 3.9%, reversing a 0.4% rise in November, the report said.

U.K. retail sales volume grew 1.9% month-on-month, in contrast to the revised 4 percent decline in December, separate data showed.

This was faster than the expected growth of 1%. On a yearly basis, overall retail sales advanced 9.1%, reversing a 1.7% fall in December.

France inflation increased as initially estimated in January on higher energy and services prices, final data from the statistical office Insee showed.

Consumer prices grew 2.9% on a yearly basis in January, after climbing 2.8% in the previous month. The rate matched the preliminary estimate published on February 1.