European stocks slip lower; UK GDP returns to growth

European stock markets traded marginally lower Friday, as investors digested lackluster British growth data ahead of key US bank earnings and a highly-anticipated Chinese fiscal policy briefing. 

At 03:10 ET (07:10 GMT), the DAX index in Germany traded 0.1% lower, the CAC 40 in France fell 0.1% and the FTSE 100 in the U.K. dropped 0.4%. British economy starts to grow

Data released earlier Friday showed that Britain's economic output rose by 0.2% in monthly terms in August, in line with expectations, and after no growth in the previous two months.

Compared to a year ago, economic output was 1.0% higher, below the 1.4% growth forecast by economists.

The data “lends some support to our view that a mild slowdown in GDP growth in the second half of this year is more likely than another recession,” said analysts at Capital Economics, in a note.

German inflation eased to 1.8% in September, the federal statistics office said on Friday, confirming preliminary data.

The European Central Bank meets next week, and is expected to ease policy once more, especially as inflation in the eurozone’s largest economy is now below its medium-term target. Chinese policy briefing in spotlight

Of particular interest Friday was the news that China's finance minister has called a fiscal policy briefing for Saturday, with investors looking for more fiscal stimulus to reinvigorate the second-largest economy in the world.

Markets are expecting Beijing to announce 2 trillion to 3 trillion yuan ($280-$420 billion) in new spending, but nervousness exists after a disappointment from a similar policy makers' briefing early this week.

China is a major export market for a number of Europe’s major companies, and its economy has been struggling in the face of sluggish consumer spending and a real estate crisis. BP slips on "broadly flat" output

In the corporate sector, BP (NYSE:BP ) stock fell almost 1% after the energy giant stated that it expects third-quarter output to be “broadly” flat, while net debt at the end of the quarter is now expected to be higher.

Most of the day’s attention, however, could be focused across the pond as US banking giants – JPMorgan Chase (NYSE:JPM ), BNY Mellon (NYSE:BK ) and Wells Fargo (NYSE:WFC ) – are due to release their quarterly results before the open. 

These bank results usually mark the start of the US earnings season, and will be a test for a stock market near record highs and trading at lofty valuations.

Tesla (NASDAQ:TSLA ) will also be in focus after the EV manufacturer unveiled its long-awaited Cybercab robotaxi late Thursday, with CEO Elon Musk claiming that the vehicle will go into production by 2026, and will cost less than $30,000. Milton damage in focus 

Oil prices rose Friday, set for a second straight weekly gain as investors assessed the impact of US hurricane damage while tensions in the Middle East remained elevated. 

By 03:10 ET, the Brent contract climbed 2.3% to $78.36 per barrel, while U.S. crude futures (WTI) traded 2.1% higher at $74.81 per barrel.

For the week, both benchmarks were headed for gains of around 1%.

In the U.S., Hurricane Milton cut a destructive path across Florida, leaving millions without power. The destruction could dampen fuel consumption in the world's largest oil producer and consumer.

Additionally, traders remained on edge over a potential escalation in the conflict in the Middle East, especially if Israel targets Iran’s oil facilities. 

 

Source: Investing.com