Europe close: Stocks slip as Ukrainian rebels order civilian evacuation

European shares gave up early gains on Friday after separatists in Ukraine's two breakaway regions, Donetsk and Luhansk, ordered the start to the immediate evacuation to Russia of children, women and the elderly following recent bombardments.

The pan-European Stoxx 600 ended the session down by 0.81% at 460.81, alongside a 1.47% drop for the German Dax to 15,042.51 while the FTSE Mib declined by 0.61% to 26,506.79.

Front-dated Brent crude oil futures fell 0.51% to $91.29 a barrel on the ICE and euro/dollar was off by 0.31% to 1.1326.

"Early gains soon disappeared on reports that separatist leaders in Eastern Ukraine were evacuating their citizens in the region into Russia for their own safety," said Michael Hewson, chief market analyst at CMC Markets UK.

The announcement was followed roughly two hours afterwards by the explosion of a car belonging to the militia leader of the Donetsk People´s Republic, Denis Sinenkov, who remained unscathed.

Russian President Vladimir Putin later ordered that preparations be made to house refugees in the neighbouring Rostov on Don region and called on Ukrainian authorities to "sit down at the negotiating table" with separatist leaders "and agree on political, military, economic and humanitarian measures to end the conflict."

Kiev refuses to negotiate with what it says are Russia-backed separatists.

Overnight, US Secretary of State Antony Blinken agreed to a meeting with Russia's foreign minister late next week provided Russia does not invade Ukraine, bolstering hopes for an easing of tensions.

Nevertheless, Hewson added: "It is becoming increasingly clear that the US appears to think a Russian invasion is only a matter of time, and whether it comes this week, or in a few days, US officials want it to be clear that if, and when it does happen, Russia won't be able to hide behind a 'false flag' event to justify it."

In equity news, shares in Finnish pharmaceutical company Orion soared by 23% after positive results from a trial of its prostate cancer drug.

UK builder Kingspan gained after the insulation specialist said it had spent €800m on acquisitions since the start of the year, it said after posting a 49% annual profit jump.

Shares in French luxury group Hermes fell after the company said sales grew by 11% in the fourth quarter of 2021, as self-imposed production caps meant the group could not keep up with demand for its prized handbags.

Shares in NatWest Bank fell as the UK lender lowered cost-cutting targets and reporting a big swing to full-year profit.