By Aude Lagorce and V. Phani Kumar
European markets rose Friday as gains for defensive stocks offset declines for banking shares.
A report showing a surge in Chinese inflation kept stocks in check as it fueled expectations of further monetary tightening that could slow the country's growth. That also hit most Asian markets, although China's benchmark eked out a gain, with analysts saying the inflation news had already been priced in.
The Stoxx Europe 600 index rose 0.3% to 277.78, paring losses for the week to 1.4%.
Defensive stocks such as consumer-goods firms Reckitt Benckiser Group and Beiersdorf /zigman2/quotes/210479173/delayed DE:BEI +0.39% did well, ending up 2.7% and 2.1%, respectively.
Financial shares, on the other hand, sagged after Bank of America reported weak results. Commerzbank /zigman2/quotes/200193353/delayed DE:CBK +6.82% dropped 4.3% in Frankfurt, while Credit Agricole /zigman2/quotes/209264506/delayed FR:ACA +2.25% dipped 1.9% and Natixis fell 1.7% in Paris.
In LONDON , the FTSE 100 index added 0.5% to 5996.01, helped by gains in the retail sector, but it slipped 1% for the week. Hedge-fund manager Man Group climbed 4.2% after Bank of America Merrill Lynch added it to its Europe 1 focus list, saying it is likely to be a strong performer over the next two to three years.
But semiconductor firm Micro Focus International lost 7.8% after it announced that Chief Executive Nigel Clifford was leaving barely a year into the job.
Next PLC added 2% and Marks & Spencer Group /zigman2/quotes/206225481/delayed UK:MKS +2.78% advanced 1% after unlisted supermarket Waitrose reported that sales soared 25% year-on-year.
In FRANKFURT , the DAX 30 rose 0.4% to 7178.29, led by a 2.4% advance for drug firm Merck KGaA /zigman2/quotes/200605022/delayed DE:MRK +1.32% . The index snapped three weeks of gains with a 0.5% weekly loss.
Hochtief /zigman2/quotes/205338461/delayed DE:HOT +5.17% lost 3.6% after UBS /zigman2/quotes/206172872/composite UBS +11.81% downgraded the German construction group to "neutral" from "buy."
In the chemicals sector, K+S rose 1.3% after it said it was considering further price hikes for potash fertilizer. BASF /zigman2/quotes/204280060/delayed DE:BAS +0.73% gained 1.7%.
In PARIS , the CAC 40 inched up 0.1% to 3974.48, helped by a 2% gain for cosmetics giant L'Oreal /zigman2/quotes/204720038/delayed FR:OR -0.35% , but finished the week down 2.2%. Carrefour /zigman2/quotes/208564127/delayed FR:CA +1.17% fell 1.4% as Jefferies analysts cut their rating on the stock to "hold" from "buy," citing the group's sluggish European performance and worst-than-expected cash flow.
In TOKYO , the Nikkei Stock Average slipped 0.7% to 9591.52. That left it down 1.8% on the week to snap a three-week win streak. Hitachi Construction Machinery /zigman2/quotes/205375504/delayed JP:6305 -1.63% shed 1.4% and Sony fell 1.3%.
In MUMBAI , the Sensex fell 1.6% to 19386.82, weighed down by Infosys, which slumped 9.6% as the company's 14% increase in fiscal-fourth-quarter net profit and its earnings forecast fell short of expectations. ICICI Bank and real-estate concern DLF both fell 2.4%, after data showed India's wholesale-price index for March rose nearly 9%, well above market expectations.
In SHANGHAI , the Shanghai Composite Index rose 0.3% to 3050.53, a 2011 closing high. Poly Real Estate Group /zigman2/quotes/201864015/delayed CN:600048 -1.12% rose 2.3% in Shanghai and China Vanke /zigman2/quotes/205643772/delayed CN:000002 +0.13% advanced 1.1% in Shenzhen.
Write to Aude Lagorce at aude.lagorce@dowjones.com and V. Phani Kumar at phani.kumar@dowjones.com
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