European stocks declined as renewed trade concerns weighed on markets, while Swedish telecommunications equipment maker Ericsson surged following strong earnings results.

The STOXX Europe 600 index fell 0.4% at the London close. France's CAC 40 index narrowed its decline to 0.2% after Prime Minister Sebastian Le Cornu indicated he would propose suspending pension reforms, sacrificing a key economic measure in pursuit of political stability.

Trade-sensitive automotive and mining stocks led the decline, while defensive sectors including telecommunications, real estate, and utilities outperformed the broader market.

Ericsson shares jumped 18%, marking the largest gain since 2002, driven by the sale of its call routing business Iconectiv, which boosted the company's third-quarter profits and cash flow. Michelin fell 8.9% after the tire manufacturer issued a profit warning due to significantly weak performance in the North American market.

"The recurring tariff issues and escalating divisions have heightened market anxiety, highlighting the fragility of current market stability," said Guillermo Hernandez Sampere, trading director at asset management firm MPPM. "Reaching a swift agreement has become urgent to maintain the market's previous gains."

Deutsche Bank strategists expect European corporate earnings to achieve low single-digit growth supported by the macroeconomic environment, suggesting actual results will exceed market consensus expectations by 5%. The recovery momentum of luxury goods stocks will face testing during earnings season as their valuations have returned to elevated levels.