European stocks flitted between small gains and losses Wednesday, while the euro lost ground against the dollar after some disappointing GDP data from France and Germany.
Stocks had been called to open higher on the back of a strong showing in the U.S. and Asia, where the Dow Jones Industrial Average hit another record close and the Nikkei Stock Average ended above 15000 for the first time in more than five years. However, early data releases soon dampened the mood.
Figures showed the French economy fell into recession—usually defined as two consecutive quarters of falling output—at the beginning of the year. Although Germany narrowly avoided recession, growth there was weaker than expected.
"Today's German data, coupled with the 0.2% decline in French GDP, certainly confirm that the euro-zone economy is on a recessionary trend," said Newedge. "Our below-consensus forecast is for euro-zone GDP to fall by 0.2% quarter-on-quarter in the first quarter."
Given the weak French and German numbers, investors will keep a close watch on the preliminary estimate of first-quarter euro-zone GDP data due later.
In corporate news, shares in London-listed commercial broadcaster ITV ITV.LN -3.21% fell despite the company posting a rise in first-quarter sales. Analysts said the first-quarter results were solid, but pointed to a weak second-quarter outlook for net advertising revenue.
London Stock Exchange LSE.LN +2.62% fared well, however, after the company reported a better-than-expected increase in full-year total outcome and said it was optimistic about the rest of the year.
Commerzbank CBK.XE +16.27% was also on the front foot, after the German government's stabilization fund said it completed the placement of around €625 million ($807.6 million) in existing shares of the company, at a price of €7 a share.
