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Europe shares end mostly higher as euro rallies

European equities closed mostly higher on Wednesday as investors reacted to a slew of earnings reports and new economic data, as the euro rallied against the dollar.

The pan-European Euro Stoxx 600 Index finished lower after fluctuating for much of the session, but major bourses managed to eek out gains to finish in positive territory.

SocGen slips

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Major earnings dominated much of the session, with J Sainsbury shares closing down around 3 percent after the supermarket chain booked a £72 million ($110 million) net loss for the year to March 14 on Wednesday. Telenor - a Norwegian multinational telecommunications firm - surged over 5 percent after its earnings report on Wednesday.

Currency markets were also in focus, as the euro rallied against the dollar, breaking through $1.13 for the first time since February.

Read MoreSainsbury's Egypt woes should be removed soon: CFO

French bank Societe Generale saw its shares slip as much as 3 percent after its first-quarter results. The French lender highlighted improving conditions for its Russian operations but still took a 525 million euro write-down on its business in the country.

Read MoreSocGen CEO: Russia is now normalizing

Meanwhile, Credit Agricole shares finished 0.5 percent higher after the banking group reported a 2.6 percent rise in first-quarter net income on Wednesday, compared to the year before.

Greece in focus

On the data front, a final composite Purchasing Managers' Index for the euro zone came in above expectations on Wednesday morning. The April figure rose to 53.9 above a flash estimate of 53.5.

Greece continues to dog the headlines, as talks continue between the debt-stricken country and its lenders over reforms.

Greek Finance Minister, Yanis Varoufakis, said after talks in Paris and Brussels on Tuesday that he expected euro zone finance ministers to acknowledge progress towards a cash-for-reform deal, opening the way to easing Athens' liquidity crisis, Reuters reported.

Read MoreEuclidTsakalotos, the new 'friendly face' of Greece?

On Wednesday, a Greek official told the news wire that the country had made a 200 million euro ($225 million) payment due to the International Monetary Fund (IMF). Greek stocks finished over 2.8 percent higher.

U.S. stocks traded mildly lower after turning negative on Wednesday as investors weighed comments from the Fed Chair on valuation amid higher yields and energy prices. U.S. equities followed European stocks lower on currency moves. The U.S. dollar traded more than 1 percent lower against major world currencies,

U.S. Treasury yields pared gains after morning data but continued to hold near recent highs. The German 10-year bund yield continued to trade higher near 0.55 percent.

UK elections ahead

Just a day before polling kicks off in the U.K., the incumbent Prime Minister David Cameron and Ed Miliband, the leader of the opposition Labour party, are level in most polls, showing that another coalition government is a highly probable outcome of the election.

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