Finance

The pan-European STOXX 600 index closed 0.75% lower at 625.51, marking its second consecutive session of declines and hitting its lowest level since mid-June. Equities across the continent gave up previous weekly gains as regional benchmarks buckled under the combined weight of rising sovereign yields and geopolitical tension.

European banking shares suffered steep losses, with the sector dropping to its lowest level in over three months. Major financial institutions including Deutsche Bank, Banco Santander, Societe Generale, and UniCredit led the downward trend as investors responded to surging Eurozone sovereign bond yields.

Concerns over France's deteriorating fiscal health ahead of its upcoming presidential election have fueled anxiety in the sovereign debt market, causing French bond spreads to widen. The euro faced intense pressure and hit a 17-month low as international investors shed the currency amid warnings from major banking executives on the gravity of the nation's debt crisis.