Europe close: Equities slide as traders play it safe

European stocks fell on Friday as next week’s US presidential election continued to weigh on investors’ minds, despite the positive reaction from economists to the latest US non-farm payrolls report.

The benchmark Stoxx Europe 600 index retreated 0.83% to 328.80, Germany’s DAX gave back 0.65% to 10,259.13 and France’s CAC 40 fell 0.78% to 4,377.46.

Analysts at Citi pegged the odds of a Trump US presidential election victory at 25%, cautioning clients that was a 'non-negligible' probability and that a win by the Republican presidential candidate could see a sell-off in the S&P 500 of between 3% to 5%.

Stateside, Wall Street was attempting to mount a bounce following eight consecutive sessions lower for the S&P 500.

US non-farm payrolls grew by 161,000 in October (consensus: 173,000), but upwards revisions of 44,000 to the prior two months of data offset the negative surprise.

Furthermore, average hourly earnings rose by 0.4% month-on-month (2.8% year-on-year), outpacing forecasts for a rise of 0.3% and 2.6%, respectively.

Commenting on the US jobs report, Barclays Research said: "overall, we believe the wage data and upward revisions to prior months data more than offset the softness in services employment. In our view, this report clears the bar for a December rate hike and represents some of the progress towards the dual mandate that the committee requires."

Meanwhile, oil prices were again lower, with West Texas Intermediate retreating 1.5% to $44.00 a barrel and Brent crude down 1.89% at $45.49.

The move came as Reuters reported that at a meeting held during the previous week Saudi Arabia told Iran it could increase output "steeply" if Tehran refused to limit its supply.

In corporate news, Commerzbank declined after saying it swung to a net loss in the third quarter.

British Airways and Iberia parent International Consolidated Airlines Group flew lower after it cut its target for average annual earnings before interest, taxes depreciation, amortisation and rental costs to around €5.3bn from 5.6bn previously.

EasyJet was also in the red after the budget airline said passenger numbers rose last month, but the load factor dropped. Passenger numbers were up 6.9% from last October to just over 6.84m, but the load factor – which gauges how full the planes are – fell to 90.2% from 93.3%.

JC Decaux skidded after the outdoor advertising company said it expects to see a drop in fourth-quarter organic revenue growth.

On the upside, Lafarge Holcim was in the black despite reporting lower revenue than expected for the third quarter, as it said it was on track to meet full-year targets.

Paddy Power rallied after lifting its full-year profit forecast and posting a rise in core earnings for the three months to the end of September.

Richemont shares gained ground as the Cartier maker posted weaker-than-expected profits for the six months to the end of September and announced that its chief executive and chief financial officer will step down next year.

On the macroeconomic front, Eurozone services activity grew less than expected in October.

Markit’s final services purchasing managers’ index rose to 52.8 from 52.2 in September, but was below the initial estimate of 53.5.

Meanwhile, the composite PMI, which combines manufacturing and services, came in at 53.3, below the flash estimate of 53.7 but up from the previous month’s 52.6.