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Europe closes sharply lower; down 4% for the week; oil weighs

European markets closed sharply lower on Friday as investor sentiment was curbed by more declines in the oil price.

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The pan-European STOXX 600 closed down 1.86 percent provisionally with stocks also under previous in the United States. The benchmark finished the session with a weekly loss of around 4 percent. All major indices were in negative territory with the German DAX finishing over 2 percent lower.

The decline in oil prices continues to weigh with both Brent and U.S. crude trading at record lows, below $39 and $36 a barrel respectively.

The IEA said in a report on Friday that it sees the world oil market remaining oversupplied until late 2016 at least, pushing the price of oil even lower. Offshore driller Seadrill and Tullow Oil saw shares sharply drop as a result.

And the miners were under continued pressure after a tough week for the sector. Earlier this week, Anglo American said it would cut 85,000 jobs over the next few years, while Glencore announced further debt-cutting plans. Glencore and Anglo American both closed down over 4 and 8 percent respectively.

In Asia news, China's yuan sank to a four-and-a-half-year low after the PBoC set the midpoint rate for the currency down further, stoking expectations of further weakness in the currency.

Bellway soars

House builder Bellway saw shares close up 4 percent after the U.K. firm gave a trading update in which it said house reservations rose 12 percent in the 18 weeks to December 6.

Software firm Micro Focus also finished higher after Investec and Barclays raised their target prices for the stock.

Anglo-African financial service firm Old Mutual and South African-founded bank Investec both closed around 11 percent lower after the South African president sacked his finance minister Nhalnhla Nene, a decision that was widely criticized.

And the luxury sector was mostly lower after Bernstein cut its price target for Burberry, Richemont, Swatch and Hermes.

Russia holds

Meanwhile, Russia's central bank decided to keep rates on hold at its latest monetary policy meeting Friday, a move widely expected as inflation remains stubbornly high.

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