EUROPE MARKETS: European Stocks Close Lower, Shaken By Reports Flynn With Testify About Trump

By Carla Mozee and Sara Sjolin, MarketWatch Features Dow Jones Newswires

Eurozone manufacturing PMI advances in November

Continue Reading Below

Stocks across Europe finished lower on Friday, after a late-session slump on reports former U.S. national security adviser will testify about President Donald Trump.

Markets had already opened in negative territory after U.S. lawmakers had trouble passing a long-awaited tax bill and pushed the vote back to Friday.

What markets are doing: The Stoxx Europe 600 ended 0.7% lower at 383.97, closing out the week with 0.7% loss.

Germany's DAX 30 index slumped 1.3% to 12,861.49, and France's CAC 40 gave up 1% to 5,316.89. The indexes ended with weekly losses of 1.5% and 1.4%, respectively.

The U.K.'s FTSE 100 fell 0.4% to 7,300.49, losing 1.5% for the week.

Continue Reading Below

What's moving markets: European equities fell alongside U.S. stocks after ABC reported that Flynn has promised full cooperation with Special Counsel Robert Mueller (http://www.marketwatch.com/story/former-trump-national-security-adviser-michael-flynn-pleads-guilty-to-lying-to-fbi-2017-12-01), who's investigating Russia's alleged interference in the U.S. election. Flynn is prepared to testify that Trump during the election campaign directed him to make contacts with the Russians, according to the report.

Stock were already lower earlier in the day after the U.S. Senate late Thursday suspended a vote on a tax bill as lawmakers continued to debate a number issues related to cutting rates for individuals and corporations.

Read:Here's what's next for the Senate's tax bill (http://www.marketwatch.com/story/heres-whats-next-for-the-senates-tax-bill-2017-11-30)

The Stoxx Europe 600 Financial Services Index fell 1.2% and the Stoxx Europe 600 Bank Index declined 1.1%. Financial stocks were among those shaken by the tax-reform delay in Washington, with investors running to the perceived safety of sovereign bonds that sent their yields lower. The yield on Germany's 10-year bund fell 7 basis points to 0.303%

The crucial vote in the Senate on tax reform was expected to resume on Friday.

The euro erased an earlier loss against the dollar and swung higher to $1.1930 after the Flynn news. The shared currency traded around $1.1904 late Thursday in New York.

What strategists are saying: "European equity markets dropped quickly in the wake of the announcement that Michael Flynn, the ex-national security adviser head, lied to the FBI regarding the Russia investigation. The old chatter from the summer about President Trump being impeached have surfaced again," said David Madden, Market Analyst at CMC Markets UK, in a note.

Stock movers: Altice NV (ATC.AE) rose 0.4% as the telecoms group said it plans to sell its Switzerland-based (http://www.marketwatch.com/story/altice-to-sell-swiss-data-center-assets-2017-12-01) data-center operations and telecommunications solutions business to InfraVia Capital Partners.

Royal Bank of Scotland Group PLC (RBS.LN) (RBS.LN) fell 2.4% after the company said it would close 259 branches and cut 680 jobs (http://www.marketwatch.com/story/rbs-cutting-680-jobs-in-the-uk-as-mobile-banking-picks-up-2017-12-01) to reduce costs as more customers having been using mobile and online services.

Air France-KLM shares (AF.FR) advanced 0.9% as the airline's stock was upgraded to hold from sell at Deutsche Bank.

Economic data: IHS Markit said its final November manufacturing PMI reading for the eurozone came in at 60.1, up from October's print of 58.5 and marking its best reading since April 2000.

IHS Markit/CIPS said its U.K. manufacturing PMI for November was 58.2 (http://www.marketwatch.com/story/uk-manufacturing-pmi-picks-up-in-november-2017-12-01), and that was better than the FactSet estimate of 56.5.

(END) Dow Jones Newswires

December 01, 2017 12:08 ET (17:08 GMT)