European stocks open lower, but are heading for their best weekly performance in more than 3 months

European stocks fell on Friday but remain on course for their biggest weekly percentage jump in more than three months, driven by hopes the Federal Reserve will stop raising interest rates soon as inflation subsides.

The pan-European Stoxx 600 index was down 0.2 percent by 0702 GMT.

However, it rose 2.9 percent this week, on its way to recording its best weekly performance since the end of March and making up for almost all of last week’s losses.

US consumer and producer price data, released earlier this week, fueled speculation that the economy has entered a phase of de-inflation and that the Federal Reserve may stop tightening shortly after July.

The Stoxx 600 index was pressured on Friday by a 0.6 percent drop in telecoms companies, including Nokia, whose share fell 5.3 percent after lowering its full-year results forecast.

Swedish rival Ericsson fell 4.2 percent after the company reported a 62 percent drop in adjusted operating profit for the second quarter.

Mining stocks, which were among the biggest gainers this week, also fell 0.6 percent.