European stock markets closed mostly higher after a choppy day
of trade Thursday, as the International Monetary Fund approved a
loan to Greece, while declining oil firms weighed on sentiment.
The Stoxx Europe 600 index closed 0.3% higher at 270.98, after
trading as low as 269.37 earlier in the day.
The index headed north in late afternoon trade after the IMF, as
expected, approved a four-year EUR28 billion loan for Greece, as
part of a broader rescue package for the debt-laden country. The
IMF said EUR1.65 billion will be available for immediate
disbursement.
The Athens General Index added 0.8% to 750.32, driven by a 7.6%
gain for Hellenic Telecommunications Organization SA and a 5.4%
gain for National Bank of Greece SA.
Among biggest gainers in Europe, Aixtron SE surged to the top of
the Stoxx 600 and added 14.8% after Deutsche Bank upgraded the
stock to buy from hold.
The DAX 30 index managed to stay in positive territory through
most of the day, closing with a 0.9% gain at 7,144.45.
K+S AG also rose, up 7.2% as it raised its dividend for 2011 by
30% after posting the second-best earnings in the firm's
history.
Weighing on the German index, Deutsche Lufthansa AG lost 0.9%
after the airline swung to a EUR13 million loss in 2011 because of
higher fuel costs and a EUR361 million air-traffic tax expense.
The broader European stock market struggled for direction most
of the day and was sent bouncing around after the Wall Street open,
as investors digested U.S. economic data. The Empire State
manufacturing index for March rose to 20.2, the fourth straight
increase, and exceeded analysts expectations of 17.7, while the
Philadelphia Fed manufacturing index for March climbed to the
highest reading since last April.
Separately, the U.S. Labor department said initial jobless
claims fell by 14,000 last week to 351,000.
"After the huge run up lately, markets are taking a breather, a
pause. Markets are realizing that a catastrophe has been averted,
but that we are still in a tough economic environment," said
Philippe Gijsels, head of research at BNP Paribas Fortis Global
Markets. "But the pause in the rally is not good news. If you're
not going to go higher on good news it means that markets have
already discounted positive data. And it means markets will
certainly drop on bad news."
In London, the shares of oil producers posted declines, as
crude-oil futures traded in tight ranges around Wednesday's close
of $105.43 a barrel.
BP PLC shed 1.3%, while BG Group PLC was 0.9% lower.
The U.K.'s FTSE 100 index traded 0.1% lower at 5,940.72.
Late Wednesday, Fitch Ratings affirmed the U.K.'s triple-A
sovereign rating, but revised the outlook to negative from stable,
saying the country's "indebtedness is significantly above the AAA
median."
Also in London, Shire PLC declined 3.1%. The drug maker said it
was withdrawing an application to the Food and Drug Administration
for its Fabry disease drug, Replagal.
Supporting the U.K. stock market, miners rose along with metals
prices. Kazakhmys PLC added 1.9%, heavyweight Rio Tinto PLC climbed
1.9% and BHP Billiton PLC rose 1.3%.
The French CAC 40 index added 0.4% to 3,580.21, pushed higher by
Alstom SA up 2.2%. French newspaper Les Echos reported that the
industrial conglomerate is interested in buying Danish wind turbine
manufacturer Vestas Wind Systems, which rose 5.5%, Spain's Gamesa
Corporacion Tecnologica SA, up 4.5%, and Suzlon-controlled REpower.
A spokesman from Alstom called the report pure speculation and
declined to comment further.
Banks also provided support. BNP Paribas SA gained 1.2%, while
Credit Agricole SA added 1%.
Weighing on the index, oil group Total SA shed 0.5%.
Adding pressure to the index, Pernod Ricard SA shed 2.1%, after
Groupe Bruxelles Lambert SA confirmed it successfully sold a 2.3%
stake in the French spirit maker.
Car makers were also down, Renault SA off 1.5% and Peugeot SA
0.7% lower, after the European Automobile Manufacturers'
Association reported a 9.7% drop in new car registrations in
February.
Among other notable decliners, Spanish regional banks slumped as
housing prices fell 11.2% in the fourth quarter on an annual basis,
with the index the lowest since the beginning of 2007. Separately,
the Spanish Treasury sold a total of EUR3 billion of government
bonds at mostly lower yields.
In the secondary market, yields on 10-year government bonds were
two basis points higher at 5.20%, according to electronic trading
platform Tradeweb.
Banco de Sabadell SA lost 6.1%, Banco Popular Espanol SA fell
3.1% and BANKIA SA declined 0.8%.
The IBEX 35 index, however, closed 0.4% higher at 8,426.70.
-By Sara Sjolin; 415-439-6400; AskNewswires@dowjones.com