(MENAFN- AFP) Europe's main stock markets faltered on Wednesday as investors nervously eyed Greece's efforts to renegotiate its vast international bailout deal.
Greek Prime Minister Alexis Tsipras visited Brussels and Finance Minister Yanis Varoufakis headed to Frankfurt on the latest leg of a tour to drum up support for Athens' planned renegotiation of its 240-billion-euro ($270-billion) international rescue.
Investors meanwhile shrugged off news of the Chinese central bank's latest bid to boost its faltering economy by cutting the level of funds that banks must hold in reserve by 0.50 percentage points.
In afternoon trading, London's benchmark FTSE 100 index dropped 0.83 percent to 6,814.58 points, Frankfurt's DAX 30 index shed 0.35 percent to 10,852.63 points and in Paris the CAC 40 slipped 0.14 percent to 4,671.58.
The euro declined to $1.1410 from $1.1479 late in New York on Tuesday.
Tsipras met European Commission president Jean-Claude Juncker, while Varoufakis held talks with European Central Bank president Mario Draghi in Frankfurt.
A Greek government source said Tsipras and Juncker had discussed plans to "jointly" create a four-year reform plan for Greece.
"The more prolonged this Greek-euro tour is, and the longer the discussions go on, the worse the markets will react as investors lose patience waiting for the outcome of this important debate," said analyst Connor Campbell at trading firm Spreadex.
European stocks had rallied for a second day on Tuesday on hopes of a deal on Greece's debt, with rebounding oil prices helping energy firms.
The gains continued in Asia, where equities jumped Wednesday.
Tsipras indicated Wednesday he believed it was possible to find a solution to the debt standoff between Athens and the EU.
"I am very optimist(ic) that we will try to do our best in order to find a common, viable and mutually acceptable solution for our common future," he said.
- Fruitful talks -
Varoufakis meanwhile said he had held a "very fruitful discussion and exchange" with Draghi, "which gives me a great deal of encouragement for the future".
In the run-up to the meetings, a report in the Financial Times had suggested that Draghi would take a tough line with Varoufakis and could even block a key element in Athens' plans to renegotiate its bailout.
"Investors are continuing to put their faith in the prospective plan put forward by Greek finance minister Varoufakis of a debt swap linked to growth linked bonds," said CMC Markets analyst Michael Hewson.
"It remains far from clear that EU policymakers will embrace this plan."
Back in Athens, the new Greek government held its first bond auction since taking office, raising 812.5 million euros in six-month treasury bills on a higher rate than last month.
The rate was 2.75 percent, compared with 2.30 percent secured on comparable bonds issued on January 7.
The sale, which was watched closely as an indication of investor confidence in the new government, attracted less interest than previously.
Athens stocks were flat after having soared over 11 percent on Tuesday.
On the corporate front, European pay-TV broadcasting giant Sky saw its share price jump to near the top of London's FTSE 100 risers board after posting soaring half-year profits.
Sky's share price rallied 1.80 percent to 960 pence.
The biggest loser was brokerage Hargreaves Lansdown, which slid 8.23 percent to 959 pence on falling interim earnings.
In Paris, shares in LVMH shot up 7.61 percent to 155.55 euros after in luxury group saw sales rise 6 percent last year to 30.6 billion euros.
Investors looked past the fact that if exceptional items were excluded, the company that makes Louis Vuitton handbags and Moet & Chandon champagne saw net and operational profit fall.
US stocks were mixed in early trade Wednesday.
The Dow Jones Industrial Average was up 0.14 percent to 17,691.40 points after 30 minutes of trading, helped by positive earnings by General Motors and Disney.
But the broader S&P 500 slipped 0.21 percent to 2,045.67, while the tech-rich Nasdaq Composite Index lost 0.28 percent to 4,714.53.
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