European shares closed flat in volatile trading Friday following a pair of mixed economic reports from the U.S., while Germany's lowered growth outlook put a damper on gains.
The FTSEurofirst 300 Index eked out a gain.
"My preference is to the downside," said XBZ European equity options broker Mike Turner, citing uncertainty over the outcome of U.S. budget talks as a potential drag on markets in coming weeks.
Shares briefly turned positive as non-farm employment numbers released in the U.S. showed an increase of 146,000 jobs last month. The figures were above forecasts which had expected a pullback due to "superstorm" Sandy.
In stocks, the technology sector was the major gainer across European indexes, led higher by Nokia as the mobile phone firm continues to gain after a recent slump in rival Apple's stock and a tie-up with China Mobile for the new Lumia handset.
Other stocks in focus on Friday included Rolls-Royce. British regulators have asked the aerospace and defense group to hand over details of an internal inquiry into possible bribery and corruption in China and elsewhere. The U.K.'s Serious Fraud Office ordered Rolls-Royce to conduct an investigation into dealings involving intermediaries in China, Indonesia and other overseas markets earlier on in the year, the company said on Thursday.
In the U.K., home builder Berkeley released first-half earnings highlighting a 40.9 rise in pre-tax profit; shares were higher by 5.64 percent.
Reuters contributed reporting to this story.