Sruthi Shankar

European shares closed sharply lower on Friday after U.S. President Donald Trump ramped up threats of tariffs on the European Union and smartphone giant Apple, reigniting fears of a damaging global trade war.

European stocks retreated from two-month peaks on Wednesday, led by a drop in the shares of JD Sports and Julius Baer, while investors kept a cautious eye on U.S. trade developments and the tax bill debate.

European stocks ended slightly higher on Tuesday, as positive momentum fueled by a soft U.S. inflation reading and a truce in the Sino-U.S. trade spat showed signs of fizzling out, while investors assessed a mixed bag of corporate results.

Wall Street stocks advanced on Friday, notching the second straight week of gains, helped by strong economic data and potential easing of trade tensions between the U.S. and China.

Lackluster quarterly results from consumer-facing companies including McDonald's and Harley-Davidson are the latest sign that American shoppers are curbing spending amid shifting U.S. trade policies.

Britain's FTSE 100 held steady on Thursday, taking a breather from its recent rally as investors processed a wave of corporate earnings while assessing the implications of shifting U.S. trade policies.

The main UK stock indexes rose on Tuesday, with a weaker sterling helping keep the FTSE 100 near all-time highs, while upbeat earnings from companies including Abrdn and Premier Foods boosted the midcap index.

London's blue-chip FTSE 100 hit a record high on Monday for the second session in a row as investors awaited Donald Trump's return to the White House for fresh insights on his stance on tariffs and international relations.

British midcap stocks logged their biggest weekly decline in more than a year on Friday, as surging borrowing costs on the back of higher inflation expectations and concerns about Donald Trump's return to the White House hammered risk sentiment.

European shares closed out a holiday-shortened week lower on Friday, with heavyweight luxury firms and spirits makers leading losses, though focus remained on economic data for clues on the interest rate path and potential changes in U.S. policies under a Donald Trump presidency.