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European Shares Retreat As Caution Sets In Ahead Of Key Events


European stocks drifted lower on Friday, with financials, mining and energy stocks coming under selling pressure as investors fretted about trade fiction, rising interest rates and political risks.

Amid lack of any positive triggers, investors looked ahead to the Group of Seven summit as well as next week's ECB and Fed meetings for direction. The high-profile US-North Korea summit was also on top of investors' radar.

The pan-European Stoxx Europe 600 index was down 0.6 percent at 383.71 in late opening deals after declining 0.2 percent in the previous session in response to disappointing data on euro-area exports and German factory orders.

The German DAX was down over 1 percent, while France's CAC 40 index was moving down 0.3 percent and the U.K.'s FTSE 100 was declining 0.6 percent.

Deutsche Bank shares dropped 1.5 percent. The German bank's Chairman Paul Achleitner has spoken with top shareholders about merging with Commerzbank as Germany's largest lender struggles with its turnaround plan, the Bloomberg reported, citing people familiar with the matter. Rival Commerzbank also lost 1.5 percent.

HSBC Holdings dropped about 1 percent in London and Barclays fell 1.5 percent on worries over the effects of reduced ECB bond buying.

Mining and energy stocks also moved lower. Antofagasta tumbled 3.5 percent, Anglo American lost over 2 percent, Glencore shed 2.5 percent and Tullow Oil dropped 1.6 percent.

Standard Life Aberdeen slumped 4.2 percent after Lloyds Banking sold its remaining stake in the asset manager.

Air France KLM fell 2.7 percent after unveiling passenger traffic figures for May.

In economic news, German industrial production decreased unexpectedly in April, data from Destatis revealed. Industrial output dropped 1 percent month-on-month in April, reversing a revised 1.7 percent rise in March. Output was forecast to grow 0.3 percent.

Another report showed that Germany's exports dropped in April, while imports expanded after falling for three straight months.

France's industrial production declined for the second straight month in April on weak mining activity, the statistical office Insee showed.

Industrial output dropped unexpectedly by 0.5 percent month-on-month in April, following March's 0.4 percent decrease. Output was forecast to grow 0.3 percent.

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