European Shares Plunge Amid Mixed Corporate Updates

European shares dropped over 1% on Friday as a global risk-off sentiment prevailed. The pan-European STOXX 600 index hit a three-month low, driven by declines in the technology and financial sectors. Positive movements were seen in defensive stocks like Unilever and French firms AXA and Engie.

On Friday, European shares faced a significant decline exceeding 1%, in line with a global risk-off sentiment as investors evaluated various mixed corporate updates to understand market trends.

The pan-European STOXX 600 index fell by 1.6% to a three-month low by 0718 GMT. This index is poised to register a modest 0.1% decline for the week. All sub-sectors showed declines, particularly the technology sector at 3.7% and the financial sector at 2.6%.

This global risk-off sentiment emerged following a notably weak performance in U.S. manufacturing activity, which dropped to an eight-month low in July. Nevertheless, defensive stocks like Unilever remained in the green.

Noteworthy corporate movements included French insurer AXA rising by 1.1% after BNP Paribas commenced exclusive talks to acquire AXA Investment Managers for 5.1 billion euros ($5.50 billion). Additionally, French energy company Engie gained 2.3% after raising its profit guidance post stronger-than-expected first-half results.

(With inputs from agencies.)