Weekly Gains Amid Rating Fears: European Shares Navigate Uncertain Waters

European shares took a hit on Friday as a downturn in healthcare stocks overshadowed early gains, with the pan-European STOXX 600 falling by 0.2% amidst volatile trading conditions. Investors remained cautious ahead of Fitch's credit rating review for France scheduled later in the day.

Notable in the declines, Swiss pharmaceutical giant Novartis saw a 2.6% drop following a downgrade by Goldman Sachs, attributed to growing competition from generic drug companies. The luxury sector also struggled as analysts at UBS labeled it a 'least preferred sector,' leading to declines for industry players like L.V.M.H and Richemont.

Conversely, the market found some relief in positive momentum for aerospace and defense stocks, buoyed by geopolitical tensions, while French equities managed to edge out a 1.3% gain on the week despite internal political instability and fiscal challenges.

(With inputs from agencies.)