European shares were little changed on Friday and remained on course to end the week in negative territory as investors weighed the impact of surging oil prices driven by escalating Middle East tensions alongside the latest batch of corporate earnings, according to Reuters.
The pan-European STOXX 600 index was broadly flat at 639.36 points by 0705 GMT, reflecting a cautious mood across regional markets.
Germany's DAX outperformed its European peers, supported by a sharp rally in software giant SAP. Reuters reported that SAP climbed 4.5% after posting second-quarter current cloud backlog growth that exceeded analysts' expectations, providing a boost to investor sentiment.
The broader technology index was largely unchanged during the session after falling more than 2% on Thursday, when disappointing updates from several semiconductor companies weighed on the sector.
Energy stocks, however, slipped 0.6%, led lower by Finnish biofuel producer and oil refiner Neste. Reuters reported that the company posted second-quarter core profit that came in slightly below market expectations, dragging the sector despite elevated crude oil prices.
Oil markets remained a key focus for investors. Brent crude continued to trade above $100 per barrel after attacks by Iran-aligned Houthi forces on Saudi oil tankers in the Red Sea heightened concerns over potential disruptions to global energy supplies, according to Reuters.
Trade developments also remained on investors' radar. Reuters reported that the U.S. administration introduced new tariffs of 10% and 12.5% on goods imported from 60 trading partners, citing concerns over inadequate enforcement of forced labour restrictions. The measures came as a temporary 10% global tariff expired, adding another layer of uncertainty for global markets.
With geopolitical risks, trade tensions and the corporate earnings season all influencing sentiment, investors remained cautious heading into the final trading session of the week.
