European shares close out best week since June as earnings soften blow from tech selloff

European shares rose on Friday to wrap up their best week since late June, during which strong earnings helped cushion the blow from a global selloff in technology stocks. The pan-European STOXX 600 index rose 0.7% to 644.74 points, touching the highest in over three weeks.

 The benchmark was up more than 2% for the week. "This week has demonstrated the value of diversification when the concentrated US technology trade comes under pressure," said Daniela Hathorn, senior market analyst at Capital.com. A selloff in high-flying tech names on concerns over increased reliance on ⁠debt to develop AI infrastructure, alongside worries about competition from China, battered tech stocks this week. 

However, strong results from computer chip equipment maker ASML chip systems supplier Aixtron and telecom gear maker Ericsson have helped sentiment. "A very good positive earnings season is really going to boost investor sentiment. It could move markets back up to some of the highs that we've seen recently," said Michael Field, chief equity strategist at Morningstar. Earnings for STOXX 600 companies are expected to rise 20.7% in the third quarter from a year earlier, slightly down from the 21% growth forecast last week, data from LSEG I/B/E/S showed.