European shares end lower as earnings weigh, but log 4-week win streak
European shares finished in the red Friday, weighed by some weak earnings and as investors booked profits after recent market gains, but still finished higher for the fourth week.
The pan-European FTSEurofirst 300 Index closed lower, dragged by techs after both Google and Microsoft reported earnings that missed expectations. Still, the index closed up more than 1 percent for the week.
In the U.S., stocks reached all-time highs on Thursday, but it was a different story in Asia. Japan's Nikkei fell from a two-month peak on Friday, losing as much as 2.7 percent before paring losses as investors unwound long positions in the futures and cash markets ahead of upper-house elections over the weekend.
"As U.S. markets flirt with all-time record highs, the big question for investors is whether the improving U.S. economic position justifies current market levels or whether, as we've seen from last night's technology earnings, the current levels are overly optimistic," Rebecca O'Keeffe, head of investment at Interactive Investor said in a morning note.
Meanwhile, finance ministers and central bankers from the Group of 20 (G-20) nations met in Moscow on Friday. The leaders are due to discuss how to tackle market volatility, unemployment and a slow economic recovery.
Ahead of the two-day meeting, U.S. Treasury Secretary Jack Lew told Europe it is time to focus on boosting growth to encourage job creation.
"The U.S. is again a source of strength in the world economy, only five years after it was the center of a global crisis. This has not happened by accident," said Lew in an op-ed published by the Financial Times on Thursday. "In many parts of the world, such as Europe, growth is too weak to drive job creation, and it is critical to take steps to bolster private hiring," Lew said.
In other news, Detroit became the largest city to file for bankruptcy on Thursday. Kevin Orr, a bankruptcy expert hired by the state in March to stop Detroit's fiscal free-fall, made the Chapter 9 filing in federal bankruptcy court. The city has struggled with a slow decline in population and auto manufacturing. Automakers Ford and Chrysler Group, who have car factories in Detroit, pledged continued support and investment for the auto industry there.
In stocks news, shares of telecoms firm Vodafone rose after the company announced in its first-quarter earnings that it was hoping to complete its purchase of Kabel Deutschland later this year.
Vopak slumped after the Dutch oil storage firm cut its operating profit outlook on Friday, citing weak demand for storage in its home market.
Shares of Sweden-based security firm Assa Abloy rose after it reported that its sales had stabilized in a weak European market and its second-quarter earnings were in line with expectations.
Shares of appliance maker Electrolux climbed after reporting higher North American demand despite a profit fall for its second quarter.
So far, 53 percent of companies on the STOXX Europe 600 that have reported have beaten or met expectations, compared to 73 percent on the U.S. S&P 500, according to data from Thomson Reuters StarMine.
Shares of Banco Pop Milano surged after Goldman Sachs raised the stock to a "buy".
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