European shares close out best week since June as earnings soften blow from tech selloff

By Reuters News

By Avinash P and Niket Nishant

- European shares rose on Friday to wrap up their best week since late June, during which strong earnings helped cushion the blow from a global selloff in technology stocks.

The pan-European STOXX 600 index .STOXX rose 0.7% to 644.74 points, touching the highest in over three weeks. The benchmark was up more than 2% for the week.

"This week has demonstrated the value of diversification when the concentrated US technology trade comes under pressure," said Daniela Hathorn, senior market analyst at Capital.com.

A selloff in high-flying tech names on concerns over increased reliance on debt to develop AI infrastructure, alongside worries about competition from China, battered tech stocks this week.

However, strong results from computer chip equipment maker ASML ASML.AS, chip systems supplier Aixtron AIXGn.DE and telecom gear maker ​Ericsson ERICb.ST have helped sentiment.

"A very good positive earnings season is really going to boost investor sentiment. It could move markets back up to some of the highs that we've seen recently," said Michael Field, chief equity strategist at Morningstar.

Earnings for STOXX 600 companies are expected to rise 20.7% in the third quarter from a year earlier, slightly down from the 21% growth forecast last week, data from LSEG I/B/E/S showed.

SAP SAPG.DE, ABB ABBN.S and Barclays BARC.L are some of the firms due to report results next week.

Aixtron AIXGn.DE advanced 6% after beating order intake estimates for the third quarter and confirming annual guidance.

Nordex NDXG.DE soared 12.3% after the onshore wind turbine maker posted a better-than-expected third-quarter core profit and lifted its full-year margin forecast.

Schneider Electric SCHN.PA shares reversed earlier gains and were last down 1.8% after the industrial group raised its 2026 core profit and revenue targets for the second time.

The tech sector .SX8P was flat while the healthcare sector .SXDP eased 0.3% after gaining more than 4.6% over the previous two sessions.

Among other movers, Nestle NESN.S gained 1.7% after JPMorgan upgraded the Swiss food and drinks group to an "overweight" rating.

The gains propped up the food and beverage index .SX3P, which rose 1.4%.

The euro zone's final HICP inflation reading for September came in at 3.8% year-on-year, in line with economists' expectations but well above the European Central Bank's 2% target, showing price pressures still need to be tamed.

The ECB has raised borrowing rates by 50 basis points in 2026 to 2.50%, to curb price pressures stemming from higher oil prices.

Investors are already pricing in another quarter-point rate hike at a December meeting, according to data compiled by LSEG.

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