European stocks staged a half-hearted recovery on Friday from a sharp selloff on world markets, after Asian shares also had a partial bounceback overnight.
Eurozone stocks initially jumped 1 per cent but rapidly shed some of those gains. The main regional index was up 0.4 per cent by 0900 GMT, with Germany's DAX and Britain's FTSE 100 0.4 and 0.5 per cent higher, respectively.
The main index remained on course for its biggest weekly fall since February, down 4.3 per cent, and the rapid fade in the bounce showed how jittery investors remained after big drawdowns this week.
"The marginal traders of stocks are ETFs and quantitative funds and that's all OK when it's going up, but it's reinforcing on the way down as well. The more it goes down the more it goes down," said Eric Moore, income fund manager at Miton in London.
Third-quarter results were beginning to trickle in from European firms, with investors' eyes on Wall Street banks which report later on Friday, formally kicking off the earnings season.
Europe lags far behind the U.S. in terms of earnings growth, and stronger results will be critical in luring back some of the billions that have been pulled out of European stocks this year.
Dutch biotech Argenx topped the STOXX with a 6.2 per cent gain after its U.S. listed-shares gained 14 per cent on Wall Street on a positive note from broker Piper Jaffray.
The growth-sensitive autos sector climbed 0.6 per cent, while banks, which benefit from rising yields, were the best performers, up 0.7 per cent.
Luxury stocks, which had also suffered sharp falls as investors targeted the most highly-valued parts of the market, climbed too.
Gucci owner Kering topped France's CAC 40 with a 3.1 per cent gain, while LVMH, Moncler and Salvatore Ferragamo rose 1.7 to 1.9 per cent.
Investors had sold the sector due to its big exposure to Chinese consumers amid fears about slowing growth in the world's second-biggest economy.
"The recent derating appears overdone," wrote Credit Suisse analysts. "We see a repeat of the 2013-15 scenario as unlikely... The luxury sector has become less reliant on China to grow."
Among the biggest fallers were tobacco stocks Imperial Brands and British American Tobacco, down 3.5 and 1.9 per cent after the U.S. Food and Drug Administration reiterated its focus on reducing the amount of nicotine in cigarettes in a presentation on Thursday.
"The FDA is being increasingly noisy about the fact they're serious about this," said Miton's Moore, who holds both Imperial and BAT in his fund.
"(Tobacco stocks) still, have quite attractive financial characteristics but the tricky bit from the shareholder point of view is understanding the duration of the business."
Broker notes also moved some stocks.
Online retailer Zalando gained 3.7 per cent and Asos rose 2.3 per cent after Credit Suisse analysts said they were confident that in Europe retail brands preferred the two firms' platforms to Amazon.
(With inputs from agencies.)