Europe close: Shares dip, French issues underperform with budget in focus

(Sharecast News) - European shares finished a tad lower on Wednesday as the spectre of high US tariffs threatened by President-elect Donald Trump dampened sentiment and prompted warnings from central bankers of the impact on growth and inflation.

Against that backdrop, France's Cac-40 hit a four-month low amid concern that the government might fail to pass a budget for 2025 by the 21 December deadline, which analysts in the City said could prompt a confidence vote against it.

The pan-European Stoxx 600 index was down 0.19% at 504.96 points with all major bourses slightly in the red.

France's Cac-40 fared worst, slipping 0.72% to 7,143.03.

"European stocks as a whole have failed to keep pace with the US of late, but in France the poor performance of the luxury sector and worries about the political outlook have caused the gap to become a chasm," said IG chief market analyst Chris Beauchamp.

"A repeat of the eurozone crisis is unlikely, but ECB intervention seems to be a likelihood if the situation worsens."

The INSEE consumer confidence index declined to 89.9 this month from a revised 93.4 in October, falling further below the long-term historic average of 100, as households turning more negative about their living standards and personal finances.

In equity news, Grifols slumped 7% on a report that Canadian investment fund Brookfield is considering dropping its plan to take over the Spanish pharma firm.

Shipping firm Frontline dived 12% after reporting a sharp fall in quarterly earnings.

Shares in easyJet gave up early gains even after the budget airline posted a 34% rise in annual profits.

Aston Martin hit the brakes after yet another profit warning.