(MENAFN- AFP) Europe's main stock markets rose on Wednesday as traders digested central bank updates for clues on interest rate movements from across the globe.
London's benchmark FTSE 100 index edged up 0.05 percent to stand at 6,805.71 points in midday trading.
Frankfurt's DAX 30 rose 0.44 percent compared with Tuesday's closing level to 9,681.11 points and in Paris the CAC 40 added 0.30 percent to 4,465.86.
Madrid's IBEX 35 index gained 0.54 percent and in Milan the FTSE Mib climbed 0.99 percent.
Traders reacted to policy updates from the Bank of England (BoE) and Japan's central bank, awaiting minutes from the US Federal Reserve's latest meeting.
"Markets are looking for clues of policy intentions," said Neil MacKinnon, analyst at Russian financial group VTB Capital.
"In the UK, a strong economic recovery... puts the pressure on the BoE to reconsider its dovish rate view. I think the BoE will have to raise rates sooner rather than later. In the US, (Federal Reserve chief) Janet Yellen remains super-dovish," he added.
- Pound rallies -
In foreign exchange, the euro slid to $1.3664 from $1.3701 late in New York on Tuesday.
The European single currency sank to a 16-month low against the British pound, hitting 80.88 pence. It later stood at 80.90 percent, which was down from 81.36 pence on Tuesday.
The British pound jumped to $1.6885 from $1.6840.
"A strong UK retail sales report and a slight hawkish tone to the BoE minutes has prompted a spike in sterling," said Craig Erlam, market analyst at Alpari traders.
Minutes from the Bank of England's latest meeting indicated policymakers were edging towards hiking its key lending rate from 0.50 percent amid increasing optimism over the economic outlook.
The decision to keep rates on hold was "becoming more balanced" for some members of the nine-strong monetary policy committee, according to minutes from the central bank's May 7-8 gathering.
However, with inflation holding below the BoE's 2.0-percent target, policymakers opted for no change in borrowing costs, which have now stood at a record-low 0.50 percent since March 2009.
On the corporate front, Commerzbank shares were 2.25-percent higher at 11.36 euros, as Germany's second-biggest bank said it has suspended two foreign exchange traders suspected of being involved in the rigging of exchange rates.
Burberry shares rose 0.66 percent 1,525.00 pence after the luxury fashion group reported a jump in annual profits, as new head Christopher Bailey said expansion in Japan would help the company build on record sales.
Asia's stock markets diverged on Wednesday after a tumble on Wall Street, with Tokyo weighed by a stronger yen as the Bank of Japan held off fresh monetary easing measures and said the economy was picking up.
- Wall Street opens up -
Wall Street stocks opened higher Wednesday, with the Dow Jones Industrial Average advancing 0.46 percent to 16,450.15 points after five minutes of trading.
The broad-based S&P 500 rose 0.40 percent to 1,880.34, while the tech-rich Nasdaq Composite Index increased 0.34 percent to 4,110.88.
US shares took a dive on Tuesday in response to a barrage of mostly disappointing earnings from retailers, while downward pressure was increased after a Fed president called for interest rates to be hiked.
Reserve Bank of Philadelphia President Charles Plosser said borrowing costs may have to be raised sooner than later. While most analysts expect an increase well into next year, the dearth of any other strong catalysts led traders to take their cash off the table.
Since the start of the year the US central bank has been reducing its stimulus programme, which helps keep rates subdued, as the economy shows signs of improving.
Markets will get a better insight into the thinking of the Fed's policy board when minutes from its most recent meeting are released later on Wednesday.
Elsewhere on Wednesday, the price of gold fell to $1,292 an ounce on the London Bullion Market from $1,295.80 on Tuesday.
burs-rl/hmn
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