The European stock markets ended mixed on Friday, with the CAC 40 benefiting from a rise in the luxury goods sector, while the Footsie was weighed down by the pound's rise, which is likely to hold back export-oriented companies.

In Paris, the CAC 40 ended up 0.44% at 7,927.62 points around 16:47 GMT. In Frankfurt, the Dax closed down 0.12%, and in London, the FTSE 100 was down 0.73%.

The EuroStoxx 50 index ended stable, the FTSEurofirst 300 down 0.07% and the Stoxx 600 down 0.06%.

The Stoxx 600 hit a record high earlier in the session, buoyed by the luxury goods sector in the wake of Burberry's rise, a rise that particularly benefited the CAC 40, the index containing the most luxury goods names in Europe.

The pan-European index gained 1.6% over the week and is on track to complete its fifth weekly rise, as investors welcomed the possibility that Donald Trump might not be as tough on tariffs as expected.

In particular, the US president said during an interview on Fox News that he had had a "friendly" conversation with Xi Jinping, allowing markets to release some of the tension caused by the specter of a trade war.

In terms of indicators, the eurozone economy entered 2025 with a modest return to growth, according to a survey published on Friday. This data comes a few days ahead of next week's meeting of the European Central Bank, at which the European monetary authority is expected to make a further cut in its key rates.

VALUES

Burberry soared by 9.25% following its third-quarter results, bringing with it the European luxury goods sector (+1.05%) and stocks such as LVMH (+1.32%), Kering (+3.8%) and Moncler (3.19%).

Sectors heavily exposed to China also climbed after Donald Trump's latest statements on the friendly tone of his conversation with Xi Jinping.

The automotive sector advanced by 1.22% and the basic resources sector by 1.35%.

Among the session's losers, Ericsson shed 12.56% after reporting lower-than-expected fourth-quarter adjusted operating profit.

ON WALL STREET

Across the Atlantic, the main indices turned red at closing time in Europe after starting the session on a cautious note. The Dow Jones lost 0.12%, the Standard & Poor's 500 was stable and the Nasdaq was down 0.11%.

On the value side, Boeing lost 0.6% after warning that its fourth-quarter loss would reach $4 billion (€3.81 billion), i.e. a loss of $5.46 per share, whereas analysts were expecting a loss of $1.84 per share.

INDICATORS OF THE DAY

In the Eurozone, the stabilization of services activity in January was complemented by an easing of the long-term slowdown in manufacturing.

In Germany, private sector activity stabilized in January, marking the end of a six-month contraction, with growth in services offsetting the continuing decline in manufacturing output.

In the United States, manufacturing activity improved faster than expected in January, while services activity slowed more sharply than forecast.

As for consumer sentiment, the final figures from the University of Michigan survey were down 2.1 points on the preliminary results.

CHANGES

The dollar retreated against the euro, yen and yuan after Donald Trump's remarks on his conversation with Xi Jinping and the Bank of Japan's interest rate hike.

The greenback fell 0.70% against a basket of reference currencies, while the euro climbed 0.94% to $1.0513.

Sterling advanced by 1.11% against the dollar and 0.24% against the euro.

RATES

US bond yields retreat somewhat after the latest US macroeconomic indicators and as we await more clarity on Donald Trump's future tariff policies.

The ten-year Treasuries yield gives up 2 basis points (bp) to 4.6174%, and the two-year 3.6 bp to 4.2485%.

The ten-year German Bund yield clawed back 0.1 bp to 2.5460%, while the two-year climbed 0.7 bp to 2.2970%.

OIL

Crude oil prices are stabilizing, but remain on course to end the week on a downturn after Donald Trump announced plans to boost US production and called on OPEC to keep prices down.

Brent crude is almost stable at $78.34 a barrel, while West Texas Intermediate (WTI) is down 0.2% at $74.47.

TO BE CONTINUED ON MONDAY JANUARY 27 :

The coming week will be rich in indicators, political events and corporate results, with US megacap releases and the European Central Bank's monetary decision expected on Thursday January 30.

(Some data may be slightly delayed).

(Written by Pauline Foret, edited by Kate Entringer)

by Pauline Foret