Europe's STOXX 600 tumbled on Friday, dragged down by a sell-off in automobile and telecom shares, and closed the week lower as investors weighed retreating oil prices against fresh central-bank rate decisions. Volkswagen led the drop after slashing its outlook, while Airtel Africa sank on IPO downsizing reports.
Europe's STOXX 600 fell 1.1% to 635.45 points on Friday, erasing almost all the gains from the previous two sessions. The pan-European index ended the week down 0.6%.
Regional bourses followed suit. London's FTSE 100 dropped 1.5% and Germany's DAX fell 1.6% on the day.
Volkswagen drags the auto sector
The automobile and parts sector fell 3.4%, with Volkswagen posting its biggest one-day drop since September 2025, down 5.6%. The carmaker slashed its outlook, flagging €10 billion ($11.5 billion) in one-off items tied to its stake in Porsche, provisions for job cuts, and a weak Chinese market. Porsche shares fell 4.9% in sympathy.
Telecoms post steepest fall since April
Telecommunication stocks were down 3.3%, their biggest single-day fall since April 2025. Airtel Africa dropped 11.3% to become the index's top decliner after Bloomberg News reported its unit Airtel Money is considering downsizing its London IPO.
Food and beverage stocks lost 1.9%, with Nestle down 2.6% after Russia seized control of the Swiss food giant's local assets. Energy shares shed 0.7% on the day and fell 0.5% for the week as oil prices pared earlier losses.
Central banks in focus
A respite in the bond market sell-off and receding crude prices helped risk sentiment this week. Still, the US Federal Reserve raised interest rates, while the Bank of England held rates steady but warned further tightening may be needed if the war in Iran drags on.
According to Reuters, Daniela Hathorn, a senior market analyst at Capital.com, said: "If yields stabilise and oil continues lower, equities could find some breathing room."
The European healthcare sector was this week's best performer, followed by insurance, while banks and automobiles took the worst hit. Investors are also watching next week's meeting between US President Donald Trump and Chinese President Xi Jinping.
Source: Investing.com
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