European shares fell yesterday after a five-day winning streak, as weak Chinese economic data and declines in bellwether Swiss food group Nestle pushed markets down from four-month peaks.

Equity markets have rallied sharply since 26 July, when European Central Bank head Mario Draghi said he would do “whatever it takes” to protect the euro from the region’s debilitating debt crisis. But traders have started to recommend booking profits, due to the underlying weak global economic backdrop and the ever-present risk that Europe’s leaders may fail to agree on concrete measures to tackle the crisis.

The uncertain outlook was highlighted yesterday by data showing Chinese exports rose just 1% in July from a year earlier, missing forecasts by a big margin. Nestle was the biggest drag on the FTSEurofirst 300. Its 1.2% fall took 0.43 points off the index.

Japan’s Nikkei share average fell yesterday as investors lacked fresh incentives to buy, but the index still marked its biggest weekly gain since February following a four-day rally spurred by hopes for more global stimulus. The Nikkei lost 1% to 8,891.44 points but advanced nearly 4% up on the week, its biggest gain since mid-February, after surfing a wave of short-covering triggered by better-than-expected US jobs figures last week.

Oil demand will rise more slowly than expected next year as economic growth falters, pushing up stockpiles of fuel worldwide and offering some relief to consumers facing high prices. The West’s energy watchdog, the International Energy Agency (IEA), said yesterday it had cut its estimates of oil use worldwide for several years, trimming its 2013 demand forecast by 400,000 barrels per day (bpd) in the light of a “worrying slowdown” in global economic activity.