ROME: European stocks slipped on Friday to record their worst week in more than a month, in the wake of China’s currency devaluation.
The euro zone’s blue-chip Euro STOXX 50 index closed down 0.7 percent.
The broader pan-European FTSEurofirst 300 index retreated 0.1 percent to record a loss of 3 percent over the week – its worst weekly performance since early July.
RWE fell 2.4 percent after Natixis and UBS cut their price targets on its shares, but payment services company Ingenico rose 5.6 percent after gaining entry to the MSCI World Index, a key benchmark for many investors.
“It was quite a shock what the Chinese did – there was no pre-warning. As the dust is still settling, the market is pausing here,” said Markus Huber, senior sales trader at Peregrine & Black.
Huber said any stabilisation in the yuan next week could restore confidence to markets.
Both the Euro STOXX 50 and FTSEurofirst remain up around 10 percent since the start of 2015, as economic stimulus measures from the European Central Bank have helped to prop up the region’s stock markets.
Morgan Stanley equity strategists said investor sentiment could also be boosted if investors interpreted China’s yuan devaluation as a precursor to more action from Beijing to bolster China’s economic growth.
