- Ubisoft surges after Tencent investment
- German consumer sentiment remains unchanged amid uncertainty
- UK stocks outperform, trade-sensitive DAX falls 0.6%
- STOXX 600 down 0.2%
March 28 (Reuters) - Euro zone shares dipped on Friday, at the end of a week marred by concerns over the global economic fallout of an intensifying trade war waged by U.S. President Donald Trump.
The pan-European STOXX 600 index fell 0.2% by 0935 GMT, after two straight days of declines and on track to shed 0.6% this week. A gauge of euro zone blue-chip shares dropped by a steeper 0.5%.
Among regional markets, Germany's trade-sensitive DAX index dropped 0.6%, while UK's FTSE 100 outperformed with its 0.1% gain.
Ubisoft jumped 8.9% as the French video game maker said it had set up a subsidiary in which China's Tencent will invest 1.16 billion euros ($1.25 billion).
Europe's benchmark index retreated to two-week lows on Thursday after Trump's sweeping 25% import tariffs on the car industry raised jitters ahead of an April 2 deadline on reciprocal tariffs on U.S. trading partners.
"There's the impact of (tariffs) on earnings of the EU market, but people also worry about knock-on impact of growth scare and higher inflation in the U.S.," said Roseanna Ivory, investment director at Aberdeen.
Investors are now awaiting the U.S. personal consumption expenditures data due later in the day to gauge the trajectory for further interest rate cuts.
Erratic U.S. trade policy has fuelled fears of higher prices and a hit to growth, souring investment sentiment towards the U.S.
Meanwhile, a rotation out of the U.S. stocks and expectations of a mega fiscal boost from Germany have helped spur the strongest start to the year in five years for the STOXX 600 index.
A survey showed German consumer sentiment is broadly unchanged heading into April, with a focus on saving, highlighting uncertainty among households.
Near-term catalysts that could drive European stocks are whether there is more stimulus in China focused on improving consumer sentiment, and progress in peace talks in the Ukraine-Russia war, Aberdeen's Ivory said.
Russian President Vladimir Putin suggested Ukraine be placed under a form of temporary administration to allow for new elections and the signature of key accords to reach a settlement in the war.
In other company news, Deutsche Bank fell 2.6% as the bank extended CEO Christian Sewing's contract, while its deputy and another top executive will depart as part of a management revamp, cementing the leadership team of Germany's largest lender for the next phase of its turnaround.
Reporting by Medha Singh in Bengaluru; Editing by Mrigank Dhaniwala
Source: Reuters