Markets

European stocks close lower after euro zone PMIs disappoint; Adyen down 3.7%

Key Points
  • Euro zone flash PMI (purchasing managers' index) data published on Friday dented hopes of a V-shaped recovery from the bloc's deepest economic downturn on record. 
  • The August composite reading, widely seen as a strong gauge of economic health, fell to 51.6 from July's 54.9, considerably below analyst expectations.

European stocks closed lower Friday as investors focused on disappointing economic data out of the euro zone and geopolitical tensions.

The pan-European Stoxx 600 finished the session marginally lower by 0.15%, as most sectors and major bourses sank despite starting the session in positive territory.

Euro zone flash PMI (purchasing managers' index) data published on Friday dented hopes of a V-shaped recovery from the bloc's deepest economic downturn on record. The August composite reading, widely seen as a strong gauge of economic health, fell to 51.6 from July's 54.9, considerably below analyst expectations.

The U.K.'s August composite PMI came in at 60.3, outstripping expectations of 57.1 and a marked improvement from July's 57.0.

European markets received a cautiously positive handover from Asia, where investors digested mixed jobs data out of the U.S. The Labor Department said Thursday that initial weekly jobless claims stateside came in above 1 million, higher than a Dow Jones estimate of 923,000, but continuing claims are in consistent decline.

Market focus is also attuned to geopolitical tensions, with U.S. President Donald Trump's administration declining to acknowledge claims by China's commerce ministry that negotiators from Washington and Beijing would be returning to the table to discuss the two countries' "phase one" trade deal in the coming days.

On Wall Street Friday, stocks were rising as European markets closed. Equities were lifted by strong U.S. economic data, to end a week that saw the broader market reach a record level.

In corporate news in Europe, Bayer announced Thursday that it would pay $1.6 billion to settle a majority of claims in the U.S. relating to its birth control device, while a U.S. judge dismissed parts of a lawsuit by the Securities and Exchange Commission alleging that Volkswagen defrauded U.S. investors during its highly-publicized diesel emissions saga.

In terms of individual share price action, Denmark's Netcompany climbed 9% after Deutsche Bank raised its target price for the stock.

At the other end of the European blue chip index, Dutch payment company Adyen dropped 3.7% after several top executives sold their 15% stakes.