European stocks dipped on Friday as nervous investors awaited updates on China’s stimulus plans, while French markets edged down after the government unveiled its 2025 budget aimed at tackling a spiralling fiscal deficit.
The continent-wide STOXX 600 index was down 0.1%, capping a volatile week that saw Shanghai markets drop on uncertainty around policy support, oil prices spike on Middle East tensions and US data raise doubts about sustained cooling of inflation.
Britain’s FTSE 100 dipped 0.2%, while Germany’s DAX and Spain’s IBEX were down 0.1% each.
France’s blue-chip CAC 40 also dipped after the government delivered its 2025 budget with plans for 60 billion euros ($65.5 billion) worth of spending cuts and tax hikes on the wealthy and big companies.
Ratings agency Fitch is scheduled to update its view on France’s debt later in the day.
“We think Barnier will be successful in doing what he’s doing but the numbers need fixing. Eventually our view is that this government in France will do what it takes to ease the concerns by the European Commission,” said Andrea Cicione, head of research at TS Lombard.
Overall, there was a sense of caution as investors awaited China finance ministry’s press conference on Saturday, with expectations of stimulus announcements running high.
European markets closed lower on Thursday after data showed US inflation rose slightly more than expected in September, potentially keeping the Federal Reserve on track to cut rates again next month.
Traders currently see an 85% chance of a rate reduction of 25 bps.
European stocks end lower after US inflation data
The European Central Bank will meet on Oct. 17, and a rate cut is almost fully priced in with a December move also firmly expected.
Among single stocks, Chrysler parent Stellantis fell 3.6% as the company confirmed that CEO Carlos Tavares would retire at the end of his contract in early 2026.
Shares of Sainsbury’s dropped 5% after the Qatar Investment Authority, the biggest shareholder in the British supermarket group, sold shares worth 306 million pounds ($399.88 million).