European stocks on Friday clocked their fifth straight week of gains, with investors buying into the oil and gas and banking sectors, while Novo Nordisk A/S rose after US approval of its oral diabetes drug.
Investors also sought refuge in the so-called defensive sectors such as utilities, real estate and food and beverages ahead of a week packed with economic data.
The UN General Assembly would also provide clues on the fallout from attacks on Saudi Arabian oil facilities on Sept. 14 and indications of a potential meeting between the presidents of Iran and the US.
“After [the UN General Assembly] things may become more uncertain, so that could explain the moves into defensive stocks,” Cooperatieve Rabobank UA senior market economist Teeuwe Mevissen said.
“Markets are basically keeping their gunpowder dry for afterwards when there is certainty about where things are headed,” Mevissen said.
The pan-European STOXX 600 on Friday closed up 1.16 points, or 0.3 percent, at 392.96 in a volatile session, gaining 0.3 percent from a close of 391.79 on Sept. 13.
Novo Nordisk rose 2.6 percent after the US Food and Drug Administration approved an oral version of its diabetes drug, semaglutide.
Global equity markets were spooked at the start of the week by the attacks on Saudi Arabia that sent oil prices soaring and fanned geopolitical concerns.
However, cues of further monetary stimulus by central banks around the world calmed investor nerves later in the week.
The oil and gas sector gained 3.4 percent in the week — its biggest weekly increase in four months.
Retailers also led the benchmark STOXX 600 higher, with shares of Casino Guichard-Perrachon SA up 3.8 percent after the debt-laden company said that it was in talks to sell its discount store chain, Leader Price, to German rival Aldi.
Friday’s volatility also stemmed from “quadruple witching,” in which investors unwound positions in futures and options contracts before they expired.
In the week ahead, investors will also be watching for economic data from the eurozone and the US, including preliminary purchasing managers’ index results and economic growth figures.
Shares in some of the biggest outperformers this year were weighing on the STOXX 600.
Airbus SE, up 43 percent so far this year, was down 3.2 percent and steady dividend-paying companies including Unilever PLC and British American Tobacco PLC were down at least 1.5 percent, pushing London’s bourse down.
The FTSE 100 on Friday fell 11.50 points, or 0.2 percent, to 7,344.92, a drop of 0.3 percent from a close of 7,367.46 on Sept. 13, breaking a three-week streak of gains.
The past few weeks saw investors rotate out of growth sectors and into value stocks, with beaten-down shares of banks in popular demand.
However, the European banking index closed the week down 1 percent as investors went back into the safety sectors.
Shares in Denmark’s Jyske Bank A/S jumped 5.3 percent to the top of the STOXX 600 after the lender said that people with more than US$111,100 in their accounts would be charged a deposit rate as it seeks to pass on some of the costs of rate cuts by the European and Danish central banks.
Additional reporting by staff writer
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