European shares slipped on Friday after the previous session's rally on the European Union's debt deal, as a disappointing Italian bond auction fuelled investors' scepticism about the plan to tackle the region's debt crisis. The FTSEurofirst 300 index made its fifth week of gains, boosted by Thursday's sharp moves after policymakers struck a deal that included leveraging up a rescue fund to 1 trillion euros and a 50 percent writedown for private bondholders of Greek debt.
But some investors are concerned by the lack of detail in the outline plan. At a sale of 10-year Italian bonds on Friday, yields hit a euro-era high, underlining the country's vulnerability at the heart of the debt crisis and causing the Italian FTSE MIB to drop 1.8 percent, underperforming other exchanges.
"Yesterday was encouraging, although we do not know much details on the deal," Veronika Pechlaner, a fund manager on the Ashburton European equity fund, said. "We were fully invested going into the meeting." The FTSEurofirst 300 index closed down 0.2 percent at 1,018.14 points and ended the week up 4.1 percent - its biggest weekly gain since early October.
The benchmark index is still down 9.2 percent so far this year as concerns have grown about the macro economic environment and contagion from the eurozone debt crisis. Earnings news gave a mixed picture about how companies were holding up. Strong third-quarter sales at Renault lifted the shares up 4.5 percent to become the top performer on the French CAC, while Wacker Chemie dropped 9.8 percent to become the biggest faller on the FTSEurofirst 300 index after the world's No 2 maker of polysilicon cut its outlook.
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