Major European Markets Close Higher

(RTTNews) - European stocks closed higher on Friday and the major markets in the region posted second straight week of gains, as investors continued to cheer the European Central Bank's rate cut decision, and remained optimistic about more rate cuts by several other central banks.

Markets also reacted to positive economic data from China, and digested the latest batch of earnings updates and other corporate news.

On Thursday, the European Central Bank (ECB) cut its deposit rate by 25 basis points to 3.25%, citing sluggish economic growth and easing inflation.

According to its quarterly survey of professional forecasters, the ECB sees inflation falling to 1.9% in 2025 from a previous forecast of 2%. The projections for 2024 and 2026 were kept unchanged at 2.4% and 1.9%, respectively.

The pan European Stoxx 600 gained 0.21%. Germany's DAX and France's CAC 40 climbed 0.38% and 0.39%, respectively. The U.K.'s FTSE 100 closed down 0.32%, while Switzerland's SMI gained 0.18%.

Other markets in Europe closed on a mixed note. Austria, Finland, Greece, Ireland, Netherlands, Poland, Spain and Sweden ended higher.

Belgium, Denmark, Iceland, Norway, Portugal, Russia and Turkiye closed weak.

In the UK market, shares of mining companies moved higher after China's major commercial banks cut their deposit rates for a second time this year and the country's central bank officially launched a swap facility aimed at boosting the equity market.

Prudential gained about 3.25% and Fresnillo climbed nearly 3%. Anglo American Plc, Antofagasta, Glencore, Endeavour Mining, Whitbread, Centrica and Rio Tinto gained 1 to 2.1%.

British luxury brand Burberry jumped 3.5% after official data showed U.K. retail sales logged an unexpected growth in September on higher sales of technology products.

Smith (DS) ended down 3.4%. British American Tobacco closed lower by about 3.2% after the company said it aims to settle ongoing lawsuits in Canada through a court-mediated plan.

Vistry Group, Next, Taylor Wimpey, LondonMetric Property, Persimmon, Melrose Industries, Segro, British Land, SSE, GSK, BT Group, Marks & Spencer, Relx, Associated British Foods, Barratt Developments and Barclays Group lost 1 to 2.3%.

In the German market, Daimler Truck Holding rallied more than 7%. Continental gained nearly 3.5%. BASF, Fresenius Medical Care, Adidas, Porsche, Siemens Healthineers and Volkswagen climbed 1 to 1.6%.

Zalando, Commerzbank, MTU Aero ENgines, E.ON and Merck lost 0.6 to 1.7%.

In the French market, Kering climbed nearly 3.5%. LVMH, Societe Generale, Stellantis, Teleperformance, ArcelorMittal, Dassault Systemes, Pernod Ricard, Hermes International, Michelin and STMicroElectronics gained 1 to 2.3%.

Data from the Office for National Statistics Showed UK retail sales logged an unexpected growth in September on higher sales of technology products. The data said retail sales grew 0.3% on month in September, confounding expectations for a 0.3% fall. This marked the third consecutive increase. Sales had increased 1% in August and 0.8% in July.

The euro area current account surplus declined to a five-month low in August, to EUR 31 billion from EUR 41 billion in the previous month, the European Central Bank said. This was the lowest surplus since March. The expected level was EUR 42 billion.

Eurozone construction output grew marginally by 0.1% in August, reversing July's 0.5% decrease, data from Eurostat showed.

Eurozone inflation is expected to ease slightly more than previously estimated in 2025, according to the Survey of Professional Forecasters, released by the European Central Bank.

Headline inflation for 2024 was expected at 2.4%, unchanged from the previous outlook. The projection for next year was lowered to 1.9% from 2%. At the same time, inflation expectation for 2026 was retained at 1.9%. Longer-term HICP inflation expectations were also unchanged at 2%.

Real economic outlook for this year was maintained at 0.7%. Meanwhile, the outlook for 2025 was trimmed to 1.2% from 1.3%, which mainly reflected a carry-over from weaker than previously expected economic activity in the second half of 2024.

GDP growth is seen at 1.4% in 2026, the same as in the prior survey report. Longer-term GDP growth expectations were unchanged at 1.3%.

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