Europe Stocks Close Mixed After German Data, US Gains
European shares closed mixed on Tuesday, after better-than-expected economic data from Germany, and stock market gains in the U.S.
The pan-European FTSEurofirst 300 Index closed unofficially 0.1 percent down at 1,183.12 points on Tuesday, 6 percent below the 5-year peak set last month.
Individual country indexed pointed in different directions. The German DAX closed slightly higher after the keenly watched ZEW sentiment index came in at 38.5 in June, topping forecasts of 38.1. Plus, the U.K.'s FTSE 100 closed up, after inflation data for May came in broadly as expected.
In addition, Greek stocks closed higher after a successful government bond auction of 1.3 billion euros of three-month notes.
However, markets remained jittery ahead of the two-day meeting of the Federal Reserve, schedule to start later on Tuesday. Investors around the globe will listen with acute interest for details on when the Fed may start scaling back its $85 billion monthly bond purchases.
(Read More: Fed Meets as Faith in Its Bond Program Wanes)
Major averages have been volatile since Bernanke said last month that the Fed could begin to pare back its stimulus efforts if the U.S. economy gains momentum.
The Fed is also expected to provide an update on its economic projections for 2013-2015. The Fed's latest projections, made in March this year, saw real GDP growth at around 2.6 percent in 2013 and 3.2 percent in 2014. In terms of unemployment, the Fed projected a rate of around 7.4 percent in 2013, improving to around 6.9 percent in 2014.
"Bernanke's comments tomorrow are likely to provide clarification on the parameters of any future tapering... and will hopefully provide some clear direction for investors," Rebecca O'Keeffe, head of investment at Interactive Investor, said in a research note on Tuesday.
Shares in engineering software firm Aveva closed around 5.4 percent higher after Citigroup upgraded it to "buy" status.
Shares in cable operator Kabel Deutschland closed about 3.7 percent higher on the news that Liberty Global has made a formal offer for the German firm, raising the possibility of a bidding war with Vodafone.
Similar gains were seen in Whitbread shares, after the U.K. firm announced a first-quarter sales rise on Tuesday, helped by the strong performance of its Costa Coffee unit.