European shares close higher on ECB stimulus hopes

European shares closed up on Wednesday, after wavering throughout the day, as weak economic data from Germany fueled European Central Bank (ECB) stimulus hopes.

The pan-European FTSEurofirst300 Index fluctuated for most of the session, eventually closing provisionally up 0.8 percent at 1,385.33 points.


The main focus of the session was the widely-watched Ifo business climate index for Germany, which came in below market expectations. The Munich-based institute said the data showed a slowdown and forecast the German economy would stagnate in the third quarter.

Read MoreECB to keep loose policy 'for long time': Draghi

The weak data boosted market sentiment, because some investors believe a weakening German economy increases the chances that the ECB will implement more aggressive stimulus across the euro zone.

The French CAC 40 Index closed strongly up by around 1.3 percent. Germany's DAX Index and the U.K.'s FTSE 100 unofficially closed up 0.8 percent and 0.4 percent respectively.

Strong early trade on Wall Street also boosted European stocks. The S&P 500 halted losses after a three-day slide, with an upbeat report on U.S. new-home sales helping offset a weak reading on existing-home sales earlier in the week.

TNT Express shares tank

Shares of TNT Express plummeted to close more than 9 percent lower after the Dutch logistics company issued a profit warning.

Air France-KLM closed up around 1 percent on the news that it had suspended plans to expand its discount Transavia unit. The company denied suggestions from the French government that it had abandoned the project altogether.

Property website Rightmove also closed lower, by nearly 3 percent, after Citigroup cut its outlook on the firm to "sell" from "buy".

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