The European markets ended Friday's session with mixed results. The markets were weak in early trading, after the Bundesbank lowered Germany's growth forecast, but bounced back in the early afternoon, following the much better than anticipated U.S. jobs report for November. However, the markets pared those gains in late trading, following the release of the disappointing U.S. consumer sentiment data.
The Bundesbank on Friday slashed Germany's growth forecast for next year, citing widespread uncertainty and difficult economic situation in parts of the euro area.
Gross domestic product is now expected to grow 0.4 percent in 2013, slower than 1.6 percent expansion forecast in June. This year, growth is estimated at 0.7 percent, down from the previous forecast of 1 percent.
Growth is seen picking up to 1.9 percent in 2014. "The phase of weak economic momentum will not last very long and that Germany will soon return to a growth path," the bank said in its December monthly report.
Employment in the U.S. increased by much more than anticipated in the month of November, according to a report released by the Labor Department on Friday, with the report indicating that Hurricane Sandy did not substantively impact the data.
The Labor Department said non-farm payroll employment increased by 146,000 jobs in November compared to economist estimates for an increase of about 85,000 jobs. However, the report also showed a notable downward revision to the pace of job growth in the two previous months.
The Labor Department also said the unemployment rate dropped to 7.7 percent in November from 7.9 percent in October. The drop surprised economists, who had expected the rate to edge up to 8.0 percent.
Consumer sentiment in the U.S. has unexpectedly deteriorated in the month of December, according to a preliminary report released by Thomson Reuters and the University of Michigan on Friday. The report showed that the consumer sentiment index tumbled to 74.5 in December from the final November reading of 82.7.
The steep drop by the consumer sentiment index came as a surprise to economists, who had expected the index to inch up to 83.0.
The Euro Stoxx 50 index of eurozone bluechip stocks declined by 0.16 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.04 percent.
The DAX of Germany fell by 0.34 percent, but the CAC 40 of France climbed by 0.11 percent. The FTSE 100 of the U.K. gained 0.15 percent and the SMI of Switzerland rose by 0.09 percent.
In Frankfurt, Deutsche Telekom declined by 2.11 percent after reducing its dividend.
PATRIZIA Immobilien dropped by 2.56 percent. The real estate services firm was downgraded at HSBC.
Deutsche Wohnen lost 1.04 percent. HSBC downgraded its rating on the stock to ''Underweight'' from ''Neutral.''
Linde climbed by 0.04 percent. JPMorgan reinitiated the stock with an ''Overweight'' rating.
JPMorgan initiated CTS Eventim with an ''Overweight'' rating. The stock rose by 1.23 percent.
In Paris, Alcatel Lucent decreased by 2.94 percent. The stock will be removed from the benchmark index, effective December 24.
Deutsche Bank and HSBC reduced their ratings on GDF Suez. The stock fell by 0.49 percent.
Publicis Groupe gained 0.92 percent, after announcing two acquisitions in India.
Air France-KLM fell by 0.56 percent, after reporting increases in traffic and capacity for November.
In London, BG Group decreased by 0.05 percent. A report said the company is exploring the sale of some non-strategic assets related to its $20 billion natural gas development in Australia, as it tries to unlock more capital to meet its spending commitments.
Marks & Spencer dropped by 1.13 percent. Goldman Sachs downgraded the stock to ''Sell'' from ''Neutral,'' while raising its rating on Next, whose shares dipped by 0.19 percent.
Photo-Me International fell by 2.61 percent after reporting lower revenues in the first half of the year.
Thomas Cook surged by 12.50 percent, after Morgan Stanley upgraded the stock.
Berkeley Group rose by 4.67 percent, after the company reported increased profit in the first half and resumed its dividend.
Julius Baer climbed by 2.32 percent in Zurich. Credit Suisse reinitiated the stock with an ''Outperform'' rating.
Syngenta was upgraded to ''Neutral'' from ''Underweight'' at JPMorgan. The stock finished up by 0.11 percent.
Germany's industrial production decreased at a faster pace in October, while economists expected output remain unchanged, data released by the Ministry of Economics and Technology showed Friday.
Industrial production declined a seasonally adjusted 2.6 percent month-on-month in October, notably faster than the upwardly revised 1.3 percent fall seen in September. Economists had forecast production to remain unchanged.
German labor cost index rose 0.7 percent quarter-on-quarter on a calendar and seasonally adjusted basis in the third quarter, data from the Federal Statistical Office showed Friday. This was slower than a 1.5 percent gain the second quarter. The index has been rising steadily since the fourth quarter of 2011.
France's merchandise trade deficit decreased more than economists expected in October, data released by the Customs Office showed Friday. The trade deficit decreased to EUR4.685 billion in October from EUR4.997 billion in September. Economists were looking for a shortfall of EUR4.9 billion.
Industrial production in the UK declined more than expected in October, data from the Office for National Statistics showed Friday. The seasonally adjusted production fell 3 percent year-on-year in October compared with forecasts for a 0.5 percent fall. This marked the nineteenth consecutive monthly fall in output. In September, industrial production was down 3.2 percent.
The Greek economy contracted for the seventeenth consecutive time in the third quarter, though at a slower rate than estimated earlier, signaling a further deepening of the ongoing recession as the downturn in economic activity intensified amid the unresolved debt crisis, latest data showed Friday.
Gross domestic product, on an unadjusted basis and at constant prices, fell 6.9 percent year-on-year in the third quarter, which was slower than the 7.2 percent fall estimated earlier, the Hellenic Statistical Authority said. In the second quarter, the economy contracted 6.3 percent from a year earlier.
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