Europe Markets

European stocks close lower as Fed watch dominates

European stocks close lower as Fed watch dominates
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European stocks close lower as Fed watch dominates

European markets closed lower on Friday, as investors' focus remained on next week's meeting of the U.S. Federal Reserve.

The pan-European STOXX 600 closed down around 1 .0 percent down on the day and 0.7 percent up on the week after Wall Street stocks opened lower on Friday.

London's benchmark FTSE 100 index ended down by roughly 0.6 percent, while Germany's DAX was 0.9 percent lower and France's CAC was off by more than 1.0 percent.

European markets


"Equities back in the red, with an understandable element of traditional risk-off into the weekend as the debate about a Fed rate hike next week continues with gusto, calls for it to hold off multiplying and data from China on Sunday morning having potential to do the usual and muddy the waters on global growth yet further," Mike van Dulken, head of research at Accendo Markets, said in a note to clients on Friday.

The September meeting of the Fed, potentially its most important for years, could mark its first interest rate rise in nearly a decade. This would make it the first major central bank in the Western world to raise interest rates following the global credit crisis.

The Fed's decision will only be revealed on Thursday, so more volatility is expected early next week.

Actelion slumps on M&A discussion

On Friday, shares of Swiss drugmaker Actelion slumped to close more than 5 percent lower after it confirmed it was in talks with U.S. biotech firm ZS Pharma"regarding a potential strategic transaction", though it was not clear whether this was a buyout or merger.

France's Zodiac Aerospace was one of the top performers on the STOXX 600, closing up around 2.1 percent after UBS raised its recommendation on the stock to "buy" from "neutral."

However, shares of German energy firm E.ON closed a steep 4.4 percent lower after RBC, HSBC and Natixis all cut their price target on the company's stock.