European shares drop on hawkish Fed; LVMH shines

European shares dropped on Friday amid risk-off sentiment driven by the prospects of higher interest rates and geopolitical tensions in Ukraine, while a few upbeat earnings capped losses.

The pan-European STOXX 600 fell 0.8 per cent, on course for its fourth straight weekly decline, with autos and chemical stocks leading losses.

Luxury goods maker LVMH rose 2.5 per cent after its fourth-quarter sales growth accelerated. Rivals Kering and Hermes ticked up 0.1 per cent and 0.4 per cent, respectively.

Sweden's H&M gained 6.3 per cent after the fashion retailer posted a bigger profit rise than expected for the September-November period.

Italy's UniCredit added 0.5 per cent on better-than-expected full-year revenue and underlying profit, despite one-off hits under a new strategy by CEO Andrea Orcel driving a fourth-quarter loss for the lender.

Signify NV, the world's largest lighting maker, jumped 9.1 per cent after reporting higher quarterly earnings.