European stock indexes, including the STOXX 50 and STOXX 600, edged higher on Friday, primarily driven by gains in the banking sector. Banking giants such as Banco Santander and BBVA saw their shares rise, alongside industrial and aerospace companies like Airbus and Siemens. This upward movement followed a period of losses that had pushed benchmarks to their lowest levels since July.
Despite the daily gains, European equities recorded their most substantial weekly drop since April. This decline is largely attributed to persistent concerns over rising energy costs, which are fueling fears of renewed inflation. In response, the European Central Bank (ECB) raised borrowing costs by 25 basis points, with markets anticipating further rate hikes. The technology sector was a notable laggard, with software giant SAP experiencing a significant share price drop.