Week experiences sharpest declines since March

Some strong earnings helped European stocks end higher on Friday, but they posted their sharpest weekly and monthly declines since a brutal selloff in March, as a new round of coronavirus lockdowns dampened prospects for a sustained economic recovery.

Gains in energy major Total and some Spanish banks after upbeat results boosted the pan-European index which finished a volatile session up 0.2%.

Data showing the euro zone economy rebounded more strongly than expected also helped prop up markets, but fears that the recovery would be cut short as countries reintroduce restrictions to stem a second wave of the pandemic kept gains in check.

With Spain, one of Europe's worst COVID-19 hot spots, declaring a state of emergency until early May, and Germany and France reimposing tight restrictions this week, the STOXX 600 lost more than 5% on the week, pushing the monthly performance into negative territory.

On Thursday, the central bank gave its clearest signal yet that it will ease policy in December to help the economy through the health crisis.

Heading into the week of U.S. Presidential elections, a slide in Wall Street's big tech stocks after earnings overnight also weighed on global sentiment, with Europe's tech sector slipping 0.5%.

Third-quarter earnings season has been largely supportive, with 74% of the nearly half the STOXX 600 companies that reported so far topping profit estimates, according to Refinitiv data.

A gauge of Asian shares fell for a third straight session on Friday as jitters over upcoming U.S. presidential elections and fears that the global economic downturn will persist enveloped markets, though the index was still set to end the month higher. MSCI’s broadest index of AsiaPacific shares outside of Japan was last down 0.3%, on track to the end the week 1.3% lower after four straight weeks of gains. The index is up 3.7% in October so far. Analysts expect this broader outperformance to extend further.