European shares down on uncertainty over US-China trade deal

European shares slid on Friday with Italian stocks 2.5 per cent lower on political uncertainty, while comments by US president Donald Trump that he was not going to make a trade deal with China also weighed on sentiment.

Mr Trump's remarks followed a report that said Washington was delaying a decision to allow some trade between US firms and China's telecom equipment maker Huawei again. This added to worries about an escalation in trade tensions between the world's two biggest economies.

Dublin

The Iseq declined almost 1.4 per cent with most of its biggest stocks ending the week of a sour note. Bank of Ireland fell 5.7 per cent to €3.33 on a weak day for financial stocks across Europe, triggered by Italian turbulence. AIB closed about 3 per cent lower at €2.70.

Germans bemoaning negative savings returns should look at Berlin, not Frankfurt

---

Strong Chinese data boosts European markets

---

Automated selling has exacerbated US market swings, say analysts

---

US stocks fight back amid fears of German recession

---

Building materials maker CRH ended 1.4 per cent lower at €28.38, while food group Kerry gave up some of its previous gains, ending 1.2 per cent lower at €108.60, though Glanbia added 4.5 per cent to €11.72. Dalata Hotel Group was also one of the lesser spotted climbers, finishing up 0.9 per cent at €4.70.

Ryanair compounded its Thursday slippage, falling 1.9 per to €9.05, as directly-employed pilots in Ireland voted for industrial action. Paddy Power owner Flutter Entertainment closed 1.8 per cent lower at €71.36.

London

The FTSE 100 slipped on Friday as a mix of worries over the US-China trade dispute and political turmoil in Italy weighed on heavyweight banks and miners, while the mid-cap index fell after a surprise downturn in Britain’s economy last quarter.

The blue-chip index gave up 0.4 per cent to end its worst week in three months with a 2 per cent drop. The domestically-focused FTSE 250 handed back earlier gains to end 0.2 per cent. lower.

Losses were capped by a 7.5 per cent surge in ad firm WPP after better-than-expected organic sales performance in the second quarter.

A 6 per cent post-earnings jump in gambling firm William Hill and drugmaker Hikma was not enough to support mid-caps, which dipped as Britain's economy shrank for the first time since 2012 in the second quarter.

On The Beach slumped more than 14 per cent after the online travel agent warned annual performance would miss its own forecasts.

Europe

Along with drops of more than 1 per cent in most other major indexes, including trade-sensitive German stocks, the pan-European Stoxx 600 index gave up 0.8 per cent, in line with a move lower for world equities.

Italy's main index touched a two-month low with its bank index tumbling 4.5 per cent after the leader of the ruling League party, Matteo Salvini, pulled his support for the country's governing coalition on Thursday and called for fresh elections.

Healthcare stocks rose after strong results for Hikma Pharma in London and German optical manufacturer Carl Zeiss.

Bayer also climbed, but its gains were largely pared after a mediator dismissed an earlier report that it had offered to pay billions of dollars to settle US claims related to the Roundup herbicide. The initial report had driven its shares as much as 11 per cent higher.

US

Wall Street’s main indexes added to losses on Friday. Trump’s remarks on China followed a report that said Washington was delaying a decision to allow some trade between US firms and China’s telecom equipment maker Huawei again. That pressured the shares of chipmakers and other tariff-sensitive technology companies.

Uber Technologies shed 6.9 per cent in early trading after the ride-hailing company reported a record $5.2 billion loss and revenue that fell short of Wall Street targets.

DXC Technology tumbled 31.4 per cent after the IT and consulting services provider cut its full-year profit and revenue forecast. Nektar Therapeutics shares plunged 33.1 per cent after it flagged manufacturing issues with its experimental cancer drug.

– Additional reporting: Reuters