April 24 (Reuters) – European shares fell on Friday and were set to end the week lower, as investors remained concerned about the lack of progress toward a resolution to the Middle East conflict, while also keeping a close watch on corporate earnings.
The pan-European STOXX 600 index declined 0.5% to 611.04 points, as of 0715 GMT. It was on track to log 2.5% weekly decline after rising for four consecutive weeks.
Most of the major regional markets mirrored the decline.
Investor sentiment remained fragile despite signs of diplomatic movement. Israel and Lebanon agreed to extend their ceasefire by three weeks following a White House meeting brokered by U.S. President Donald Trump, who said he was willing to wait for “the best deal” to end the conflict with Iran.
Still, the war has now stretched to around eight weeks, with Washington and Tehran remaining at an impasse.
Markets have swung between optimism that a breakthrough may be near and concern that the conflict could drag on, with little clarity on when tensions might ease.
Benchmark Brent crude hovered above $100 per barrel, as the Strait of Hormuz remains effectively shut, adding to worries over energy supplies and inflation.
Among sectors, most traded in negative territory, with aerospace and defence leading the declines, down 2.4%.
Technology was the standout gainer, rising 0.7%, helped by a 5.5% jump in SAP shares after the German software maker beat first-quarter profit estimates on strong growth in its cloud business.
Germany’s DAX outperformed other major European indexes and was up 0.1%, supported by gains in SAP.
European corporate earnings have so far shown relative resilience, but the escalating risks tied to the Middle East conflict and surging oil prices continue to cloud the outlook.
(Reporting by Ragini Mathur; Editing by Eileen Soreng)
