U.S. stocks rebounded, and investors favored smaller cap names. The U.S. economy expanded at a faster pace in the second quarter, and durable goods orders declined for the first time in four months. European markets eased after a batch of weak earnings. The Nikkei 225 dropped to a three-month low as the yen strengthened.
The U.S. major averages extended this week's losses after Alphabet and Tesla reported earnings that fell short of market expectations. European market indexes closed down after a batch of mixed earnings. China indexes dropped amid weak earnings growth expectations and a protracted property market slump.
Semiconductor and technology stocks declined for the second day in a row amid the prospect of worsening trade ties between the U.S. and China. The European Central Bank held its key lending rates steady, citing elevated inflation pressures. China's policymakers concluded their much-delayed Third Plenum with no major announcement.