Europe close: Stocks fall as investors book profits

European stocks fell on Friday as investors booked some profits following Thursday’s Fed-fuelled gains and digested some mixed economic data.

The benchmark Stoxx Europe 600 index was last down 0.72% at 345.34, Germany’s DAX was off 0.44% at 10,626.97 and France’s CAC 40 was 0.47% weaker at 4,488.69.

Meanwhile, oil prices were lower after reports that Saudi Arabia could be ready to cut production if Iran agrees to freeze output at current levels of 3.6m barrels of oil per day.

West Texas Intermediate was down 0.89% to $45.91 a barrel and Brent crude was 0.42% lower at $47.45.

The next big focus for oil markets will be the OPEC meeting in Algeria next week.

IG's Chris Beauchamp said it was no surprise to see some profit-taking kicking in.

“Risk assets such as stocks have been firmly in favour this week, with sectors such as mining doing particularly well,” he said.

“The key central bank meetings on Wednesday cleared the way for investors to move back into equities, and while the last week of September tends to be a tough one for stock markets, the way ahead look very congenial indeed."

Data released on Friday showed output from the euro area's manufacturing and services sectors fell to a combined 20-month low in September.

IHS Markit's composite purchasing managers' output index for the single currency bloc slipped from 52.9 in August to 52.6, pointing to the slowest pace of activity since January 2015.

Significantly, the average reading for the composite PMI dipped to 52.9 in the third quarter from the 53.1 reading for the prior three months.

That, the survey compiler said, "suggested that the economy is losing, rather than gaining, momentum."

The service sector PMI fell from 52.8 to in August to 52.1 versus consensus expectations of 52.8, hitting a 21-month low.

Meanwhile, an equivalent measure for the manufacturing sector improved unexpectedly to reach 52.6, beating expectations for a reading of 51.5 and up from 51.7 in August, hitting a three-month high.

In corporate news, Danish drug maker H. Lundbeck tanked, losing 15.31% after saying an Alzheimer’s treatment failed in a late-stage study.

Indivior tumbled 4.4% as 35 US states filed a lawsuit against the drug maker alleging that it tried to keep generic versions of a drug off the market.

German lender Commerzbank reversed earlier losses to push 0.86% higher amid reports is was planning up to 5,000 job cuts.

Anglo American pushed up 3.32% after appointing Fortescue Metals’ Stephen Pearce as finance director following Rene Medori’s decision to retire, as announced back in April.

Aryzta gained 9.86% after it said Gary McGann, currently chairman of Paddy Power Betfair, will join its board as chairman.

Italy’s Moleskin surged 15.89% after Belgium’s D’Ieteren SA said it will make an offer to buy the company.

Sports Direct surged 4% after the retailer said Dave Forsey has resigned and will be replaced as chief executive by Mike Ashley.

Housebuilder Persimmon and its peers rallied after Liberum upped the stock to ‘buy’ from ‘hold’ as it turned more positive on the sector.