French carmaker Renault dragged European shares lower on Friday, while the sharpest contraction in the Chinese economy in nearly three decades exacerbated worries about slowing global growth.

Renault slumped 12.7 per cent to lowest since 2013 after the company cut its full-year revenue and profit forecast amid a broad-based slump in auto sales. The fall put the wider auto and auto parts index on course for its biggest percentage drop in two-and-a-half weeks, and pulled the Paris index down 0.2 per cent, lagging its European peers.

Adding to the gloom in the auto sector, Sweden's AB Volvo said demand for trucks would fall on both sides of the North Atlantic next year.

The pan-European STOXX 600 index was marginally lower, eyeing its third day of losses, but still on pace to end a volatile week, dominated by Brexit headlines, modestly higher.

Boris Johnson struck a Brexit deal with the European Union on Thursday, sending the benchmark index to its highest in more than a year, but concerns remain about the deal getting through the British parliament. “Everyone is very tired of Brexit. People just want to get this done and look forward to other things, like negotiating a free trade deal,” said Stefan Koopman, senior market economist at Rabobank.

Uncertainty about UK's orderly exit from the EU and other geopolitical tensions, combined with slowing global growth, have rankled financial markets this year.

After a solid increase in the first quarter, gains in the STOXX 600 index have tapered off in the second and third. Fresh data on Friday showed China's economic growth slowed more than expected in the third quarter. Investor focus now turns to the third-quarter earnings season, which kicks off in earnest next week. An earnings recession in Europe is expected to deepen in the third quarter, according to IBES data from Refinitiv.

Early earnings reports, however, were a mixed bag, with weak results from the defence and retail sectors, but a strong report from Swedish medical technology group Getinge. Its shares jumped 16.3 per cent to the top of STOXX 600 after reporting a better-than-expected quarterly core profit.

Thales, the largest European defence electronics company, dropped 3.5 per cent after lowering its 2019 revenue growth forecast, while yogurt maker Danone tumbled 6.2 per cent after narrowing its sales growth outlook for 2019.

London Stock Exchange rose 2.4 per cent after reporting a higher-than-expected third-quarter income ahead of the planned shareholder vote on its deal to buy data provider Refinitiv. The German index ticked higher, with help from Deutsche Post AG after Berenberg upgraded the stock to “buy”, while gains in banks propped up Spanish and Italian bourses.

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