European stocks fell in the year’s last full week of trading, snapping a five-week rally, as the deadline neared for a U.S. lawmakers to agree a deal to halt $600 billion of automatic tax increases and spending cuts.

President Barack Obama is due to meet at 3 p.m. in Washington with House Speaker John Boehner and Senate Minority Leader Mitch McConnell, who are Republicans, along with Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi, both Democrats. The president had been negotiating one- on-one with Boehner.

Obama returned early from his holiday in Hawaii yesterday as lawmakers disputed which party would be responsible for missing the deadline for a debt deal, a failure that could hurt the U.S. credit rating and cause an economic recession.

Confidence among U.S. consumers declined more than forecast in December as the budget debate soured Americans’ outlook for the economy. The Conference Board’s sentiment index fell to 65.1 from a revised 71.5 reading the prior month, figures from the New York-based private research group showed.

National benchmark indexes retreated in 16 of western Europe’s 18 markets this week. France’s CAC 40 dropped 1.1 percent and the U.K.’s FTSE 100 Index declined 0.3 percent. Germany’s DAX also slipped 0.3 percent, paring this year’s rally to 29 percent.

Bankia tumbled 40 percent for the biggest drop on the Stoxx 600 this week. Spain said the lender has a negative value of 4.15 billion euros in an exercise to determine how much of the rescued lender remains in shareholders’ hands. The stock will be excluded from the benchmark IBEX 35 as of Jan. 2.

Bankia group, including its parent, Banco Financiero y de Ahorros, is set to receive 18 billion euros of European funds, making it the largest recipient of the country’s bank bailout.

Banco Popular Espanol, Spain’s sixth-biggest bank, declined 7.3 percent.

Clariant (CLN) rose 4.3 percent after selling units for 502 million Swiss francs ($550 million). The specialty-chemicals maker said it will get about 460 million francs in cash for selling the textile chemicals, paper specialties and emulsions businesses to SK Capital Partners, a U.S. buyout company.

Porsche advanced 7.2 percent. The maker of the 911 sports car won an appeals court ruling in New York state dismissing a lawsuit by hedge funds that accused the German carmaker of concealing a plan to corner the market in Volkswagen AG shares.

Atari SA retreated 6.4 percent after the video-game maker said it sees a “significant” fiscal-year loss. Atari also forecast a second-half operating loss exceeding its deficit in the first half and said it’s looking at all additional means of raising or preserving cash.