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* Friday's declines cut Europe's weekly gains
* Germans head to vote on Sunday
* Adidas, Puma slide after Nike warning
(Adds comments, updates prices throughout)
By Sruthi Shankar and Shreyashi Sanyal
Sept 24 (Reuters) - European stocks fell on Friday as
worries about troubled property developer China Evergrande and
weak German business confidence data prompted investors to book
some profits after a mid-week rally.
European sportswear makers Adidas, Puma
and JD Sports fell about 3% each after U.S. rival Nike
cut its fiscal 2022 sales expectations and predicted
delays during the holiday shopping season due to a supply chain
crunch.
Retail stocks were the top decliners in Europe, down
1.7%, while the region-wide STOXX 600 fell 0.9%. But a
three-day rally put the index 0.3% higher for the week.
"Equities have rallied to take a pause early this morning
faced with the likely default of Evergrande," said Sebastien
Galy, senior macro strategist at Nordea Asset Management.
Investor worries over Evergrande resurfaced as a
deadline for paying $83.5 million in bond interest passed
without remark from the company, putting it closer to a
potential default.
Meanwhile, a survey by Ifo Institute showed German business
morale in September fell for a third straight month, hit by
supply chain woes that are causing a "bottleneck recession" for
manufacturers in Europe's largest economy.
Germany's DAX fell 0.7%, heading into the weekend
when the country will vote to elect German Chancellor Angela
Merkel's successor.
Latest polls showed the Social Democrats were clinging to a
narrow lead over the conservative CDU/CSU alliance, while the
Greens trailed.
"Some of the hesitancy in European markets could also be put
down to the German elections, which promise to be the most
interesting in some time," said Chris Beauchamp, chief market
analyst at IG.
"Markets are facing a change of direction in Germany unlike
anything seen in the past decade or more, and the end of
Merkel's tenure promises to be a watershed moment for the EU and
global investors alike."
The benchmark STOXX 600 is on course to end September in the
red after seven consecutive months of gains as rising energy
prices and supply-chain bottlenecks fed into fears of inflation,
while major central banks plan to cut pandemic-era stimulus.
However, European Central Bank President Christine Lagarde
said in an interview aired on CNBC that many of the drivers of a
recent spike in euro zone inflation are temporary and could fade
in the next year.
British drugmaker AstraZeneca rose 2.0% after the
company said its cancer drug Lynparza met its primary goal in a
late-stage trial.
Italy's utilities Enel and Eni inched
higher after the government set aside more than 3 billion euros
($3.5 billion) to curb a strong increase in retail energy bills.
(Reporting by Sruthi Shankar and Shreyashi Sanyal in Bengaluru;
Editing by Arun Koyyur and Steve Orlofsky)
