European stock markets closed mixed yesterday as disappointing US data offset the impact of successful Spanish and Italian bond sales which eased some of the concerns over the future of the eurozone.
Dealers said sentiment was dented late in the day by figures which showed new US claims for unemployment benefits rose 35,000 last week, highlighting continued weakness in the labour market.
Earlier, European markets had welcomed what were taken to be successful Spanish and Italian bond sales, following on from Portugal on Wednesday, which helped reassure investors at least for the time being.
Spain sold its maximum target of €3 billion in five-year bonds at an average interest rate of 4.542 per cent to lure investors, a competitive rate when compared to Wednesday’s market close of 4.767 per cent.
Its first bond auction of 2011, the result bolstered its case that it has no need for an emergency bailout that would rock the entire eurozone.
Spanish stocks rallied in relief, jumping more than three per cent in afternoon trading, before ending the day up 2.67 per cent.
Italy, meanwhile, raised €6 billion in bonds, also at higher rates but Milan finished the day with a gain of 0.91 per cent.
As expected, the European Central bank kept its main lending rate at a record low 1.0 per cent, like the Bank of England at 0.50 per cent, but the ECB significantly took a notably hard line on the growing risk from inflation.
In London, the FTSE 100 index of leading shares fell 0.44 per cent to 6,023.88 points. In Paris, the CAC 40 rose 0.75 per cent to 3,974.83 points and in Frankfurt the DAX edged up 0.09 per cent to 7,075.11 points.
Elsewhere in Europe, Brussels rose 0.24 per cent and Lisbon gained 0.37 per cent but Amsterdam fell 0.45 per cent and Swiss stocks slid 0.78 per cent.
US stock markets opened down after unemployment claims rose more than expected but later recovered some lost ground.
The Dow Jones Industrial Average was down 0.14 per cent at around 1700 GMT while the tech-heavy Nasdaq Composite was up 0.14 per cent.
“Initial jobless claims rose much more than expected, overshadowing another successful debt auction in Europe and an unexpected narrowing of the US trade deficit,” analysts at Charles Schwab said.
Asian stock markets closed higher, with Tokyo hitting an eight-month high, amid relief at the apparent respite in Europe’s debt crisis after Portugal’s bond sale on Wednesday.
Tokyo gained 0.73 per cent to its highest close since May 13 last year.