Nonetheless, the index is on track for a 1.9% weekly gain after several days of heightened volatility.
"A sense of caution and profit-taking is prevailing after three bullish sessions on Wall Street and two in Europe," analysts at Bankinter said on their Telegram channel.
On the geopolitical front, U.S. President Donald Trump set a 10 to 15-day deadline for Iran to reach an agreement on its nuclear program or face "very bad things," while Tehran warned it would retaliate if attacked.
Investor sentiment was also weighed down by the blow to the private equity sector, after Blue Owl Capital sold assets and permanently ended quarterly redemptions in one of its funds, fueling concerns over valuations and liquidity in the industry.
Friday's agenda features the U.S. personal consumption expenditures (PCE) deflator and the fourth-quarter GDP reading.
According to a Reuters poll, the market expects a slight uptick in the inflation figure, while economic output is seen at 3.0%. This growth would mark a slowdown from the previous quarter, but would still show "a healthy figure supported by robust consumption," Bankinter commented.
"A bad combination (of the PCE and GDP figures) because it reinforces the idea that the Fed is in no hurry to cut rates. It shouldn't have much impact though, as it is already priced in that the next move (-25 bps to 3.25%/3.50%) won't come until June when Kevin Warsh takes the helm at the Fed," they added.
Elsewhere, next week sees the release of results from Nvidia, the world's largest listed tech company, which will serve as a barometer for the state of the AI business.
At 0805 GMT on Friday, Spain's IBEX 35 benchmark stock index was up 2.10 points, or 0.01%, at 18,019.60 points, while the pan-European blue-chip index FTSE Eurofirst 300 climbed 0.28%.
In the banking sector, Santander lost 0.21%, BBVA was little changed, Caixabank advanced 0.56%, Sabadell gained 0.31%, Bankinter rose 0.21%, and Unicaja Banco was up 0.22%.
Among the major non-financial stocks, Telefónica slipped 0.06%, Inditex fell 0.21%, Iberdrola dropped 0.41%, Cellnex gained 0.27%, and oil company Repsol edged up 0.06%.
(Reporting by Tomás Cobos; editing by María Bayarri Cárdenas)
