European markets on Fri June 20: Stoxx 600, Middle East

European stocks ended the last trading day higher but were largely losers for the week as a whole.

The Stoxx Europe 600 index ended provisionally up 0.1% on Friday, but lost 1.5% for the week as investors remained focused on the escalating conflict between Israel and Iran.

Germany’s DAX was up by 1.2% but lost nearly 1% for the whole week. France’s CAC 40 also ended the week down 1.2% despite a positive close of 0.5% on Friday.

The U.K.’s FTSE 100 closed down provisionally by 0.2% on Friday, and also lost value for the week as a whole.

— Ganesh Rao

We’re around halfway through the final trading session of the week, and regional equities are still broadly on the rise.

The pan-European Stoxx 600 index was last seen trading 0.6% higher, with most sectors except oil and gas — an industry already being impacted by the escalating conflict between Israel and Iran — in positive territory.

The Stoxx Europe Oil and Gas index was last seen trading 0.1% lower, with global benchmark brent crude futures down by $1.78, or 2.3%, to trade at $77.07 a barrel.

All major bourses are in the green, with Germany’s DAX leading gains with a 1.2% jump.

The Stoxx 600’s current price puts it on track for a weekly loss of 1.1%.

— Chloe Taylor

U.S. asset management giant Apollo is set to provide a £4.5 billion ($6 billion) loan to plug a shortfall facing U.K. nuclear project Hinkley Point.

The deal was first reported by the Financial Times on Friday and supported by two sources speaking to CNBC on condition of anonymity because of the sensitivity of the matter.

The deal would be among the biggest private capital investments in a project of U.K. national interest.

Read more here.

— Jenni Reid and Spriha Srivastava

Eutelsat shares were 11% higher at 9:07 a.m. in London, after the European satellite operator announced a 1.35 billion euro ($1.55 billion) capital raise backed by the French state and other investors.

The company said that, along with a debt refinancing plan, the capital increase would support its investment in its existing Low Earth Orbit (LEO) capabilities, which are focused on business-to-business and business-to-government operations.

“As the only European operator with a fully operational LEO network, Eutelsat is positioned to play a strategic role in supporting critical sectors such as military communications, cyber-resilience, and secure government connectivity, fully aligned with European Union and NATO objectives for strategic autonomy,” it said in the release.

Other investors, including the U.K., “could join the capital raise in due course,” it added.

Writing on X, French President Emmanuel Macron said that by strengthening Eutelsat’s position France was “ensuring its strategic independence and paving the way for Europe’s” and noted he would discuss the decision at the Paris Air Show on Friday.

Eutelsat shares have been hugely volatile this year, experiencing an enormous spike in March on expectations that it could be a European alternative to Elon Musk’s Starlink, and subsequently cooling.

Read more on that from CNBC’s Ryan Browne.

European stock markets are looking to shake off some of the week’s losses at the Friday open, with the regional Stoxx 600 index up 0.5%, Germany’s DAX up 0.75% and the U.K.’s FTSE 100 up 0.33%.

In a reversal of the trend in recent days, most sectors are in the green — including travel, which is up 1.2% — while oil and gas shares are down 0.6%.

Along with publishing retail sales data, the U.K.’s Office for National Statistics said this morning that public borrowing hit £17.7 billion ($23.8 billion) in May, £700 higher than the previous year.

The budget deficit — defined as borrowing to fund day-to-day public sector activities, which the U.K. government has pledged to slash to zero — came in at £12.8 billion, down £1.7 billion on May 2024.

Public sector net debt excluding banks was provisionally estimated at 96.4% of gross domestic product, 0.5 percentage points higher year-on-year.

Economists have warned that weak growth, higher borrowing costs and reversals on some spending policies mean the U.K. may face more tax hikes later this year if Finance Minister Rachel Reeves is to meet her so-called “fiscal rules.”

“If current trends persist, total borrowing for the 2025–26 fiscal year could approach or exceed £150 billion — well above the Office for Budget Responsibility’s Spring forecast of £137 billion,” Joe Nellis, economic advisor at accountancy MHA, said in emailed comments.

“With limited scope for major tax rises or deep spending cuts in the short term, the Chancellor’s options to meet her fiscal rules are narrowing, especially the target to reduce debt as a share of GDP over the medium term.”

— Jenni Reid

U.K. shoppers pulled back on spending in May, with retail sales down 2.7% on the month, the steepest drop since December 2023, according to Office for National Statistics. Economists polled by Reuters expected a 0.5% decline.

It breaks a run of four straight monthly rises, which was the best streak since 2020, with retailers saying sunny weather in April helped to lift sales growth to 1.3%.

The bullion — which is considered a hedge against political and financial instability — has risen 31.2% since the start of the year, according to LSEG data.

— Amala Balakrishner