Despite trading slightly higher for a good part of the session, the Spanish Ibex-35 stock index ended Friday in the red, accumulating a small weekly decline in a context of growing expectation regarding next week's central bank meetings.

With monetary expectations shifting rapidly in recent days on the back of mixed macroeconomic data, markets now see a 72% chance that the US Federal Reserve will leave interest rates unchanged in the current 5%-5.25% range at its June 13-14 policy meeting, according to CMEGroup's Fedwatch tool.

The prospect of a pause to rate hikes was reinforced by data on Thursday, which showed that the number of Americans filing new claims for unemployment benefits soared to a more than 1.5-year high, suggesting an easing labor market that could further ease inflation.

"The general tone of the market is based on the idea that the Fed will pause its hikes," said Rick Meckler, a partner at Cherry Lane Investments.

"As soon as it pauses, the broader market will start to rally and perhaps catch up to the large-cap tech stocks that have led the advances so far."

The European Central Bank will also meet next week, on July 15. The expectation is that the ECB will again raise rates by 25 basis points and avoid hinting at a pause in monetary tightening. This could lead markets to trim their bets on future rate hikes, triggering an inconvenient easing of financing conditions.

Still, many analysts believe that the ECB will not be able to raise rates much further, at a time when the eurozone economy has already entered a technical recession and inflation may be starting to ease.

As a result, the Spanish Ibex-35 closed with a fall of 28.60 points on Friday, or 0.31%, to 9,309.70 points.

For the week as a whole, the Ibex-35 accumulated a decline of 0.08%, which follows a cumulative advance of 1.37% the previous week.

For its part, the FTSE Eurofirst 300 index of large European stocks lost 0.21%.

In the banking sector, Santander lost 0.79%, BBVA fell 1.15%, Caixabank dropped 1.34%, Sabadell fell 0.58%, Bankinter dropped 0.04%, and Unicaja Banco lost 0.86%.

Among the large non-financial stocks, Telefónica gained 0.26%, Inditex fell 0.36%, Iberdrola gained 0.44%, and Cellnex fell 1.93%.

(Reporting by Darío Fernández; additional reporting by Sruthi Shankar and Shristi Achar A; edited by Benjamín Mejías Valencia)