Investing.com - European stock markets closed lower Friday, with doubts remaining over valuations going forward given the weak state of regional economies.
At 11:30 ET (16:30 GMT), the DAX index in Germany dropped 0.5% and the CAC 40 in France slipped 1.6%, and the FTSE 100 in the U.K. traded 0.4% lower.
European economic weakness
The broad-based pan-European STOXX 600 gained roughly 6% in 2024, but suffered its worst quarterly drop in more than two years from October to December, weighed by regional political uncertainty, worries over monetary policy as well as concerns that Donald Trump’s return to the White House will result in a trade war.
Data released on Thursday showed factory activity in the eurozone declining at a faster rate, offering scant signals of an imminent recovery.
There was some good news Friday, as the number of people out of work in Germany rose less than expected in December, federal labour office figures showed on Friday.
The office said the number of unemployed increased by 10,000 in seasonally adjusted terms to 2.87 million, less than the 15,000 expected.
The European Central Bank cut interest rates last month, and is expected to authorize at least four 25 basis point cuts in 2025.
Tullow Oil gets tax break
In a quiet corporate sector, Tullow Oil (LON:TLW) stock was up 8.5% after the West Africa-based company said it would not have to pay $320 million in taxes after the International Chamber of Commerce's ruling on its Ghana operations.
Crude on track for weekly increase
Oil prices slipped lower Friday, consolidating the prior session’s gains amid hopes of policy support to revive economic growth in China, the world’s largest crude importer.
By 11:30 ET, the US crude futures (WTI) gained 1% to $73.9 a barrel, while the Brent contract was up 0.6% to $75.7 a barrel.
Both contracts closed at their highest in more than two months on Thursday, and were on track for their second weekly increase after investors returned from holidays, improving trade liquidity.
China's President Xi Jinping pledged more proactive policies to promote growth earlier this week, and the Financial Times reported on Friday that the Chinese central bank is reportedly planning to cut interest rates from the current 1.5% level “at an appropriate time” this year.
The outlook for oil demand largely hinges on the hope that China, the second largest economy in the world, can revive its economy, especially as there are concerns about a potential oversupply due to expected increases in production from non-OPEC countries.