European stocks lower

On Friday stocks in Europe slipped, failing to follow Asian peers higher amid conflicting reports over progress on trade talks between the world’s largest economies.

European stocks on Friday retreated from an almost-four month high as uncertainty about Italian politics contributed to a market already jittery over trade tensions between global superpowers China and the U.S.

The Stoxx Europe 600 index tipped about 0.1% lower to 395.44, on track to break a threeday winning run. On Thursday, the pan-European benchmark ended at its highest level since the 30 January buoyed by a rally for oil-related companies. For the week, the Stoxx 600 was on track for a 0.6% gain. Italy’s FTSE MIB Index slumped 1%, as political developments in the country flustered markets. Germany’s DAX 30 index was trading at break-even levels up less than 0.1%, while France’s CAC 40 index ticked up 0.1%. In the U.K., the FTSE 100 index slipped 0.2% but was still on track for a 0.6% weekly advance.

Italian politics remained in focus on Friday after the country’s two biggest populist parties on Thursday agreed on a coalition program that included plans to cut taxes and increase fiscal spending, but no direct threat to Italy’s membership of the eurozone. Credit-ratings firm DBRS warned on Thursday that the economic proposals from the 5 Star Movement and League could threaten Italy’s credit rating, according to Reuters.

Traders also watched the latest in the U.S.-China trade dispute after U.S. President Donald Trump somewhat dashed hopes of a trade deal between the two countries. At a press conference on Thursday, Trump said he doubts that the negotiations will succeed because “China has become very spoiled” on trade.

Japan’s Nikkei share average rose to a 3-1/2-month high on Friday and scored its eighth straight weekly gain after a weaker yen lifted exporters, while financial stocks extended their rally as U.S. bond yields remained high.