Europe closes higher after ECB, oil gains; Alcatel slumps

European equities closed higher on Wednesday, little changed after the European Central Bank (ECB) announced its monetary policy decision.

The pan-European Euro Stoxx 600 Index finished in positive territory, with all major bourses and sectors posting modest gains. The oil sector was an outperformer, due to a rally in the price of the commodity over the last two sessions.

The German DAX index closed up around 0.1 percent, the French CAC closed roughly up 0.7 percent and the U.K.'s FTSE 100 ended 0.4 percent higher.

The ECB announced it was holding its main interest rate at a record low of 0.05 percent on Wednesday.

In his regular press conference, ECB chief Mario Draghi dismissed fears of a Greek default and a bubble in bond markets. He said he he was unready to even "contemplate" a default by Greece, as ECB policymakers approved increasing emergency funding for Greek banks, according to media reports.

EU files charges against Google

Frankfurt-listed shares of Google closed line with the DAX index after the European Commission filed antitrust charges against the tech giant. It said Google had exploited its dominant position in the Internet search market.

Read MoreIs 'clueless' Europe about to destroy Google?

U.S. stocks traded higher on Wednesday as investors continued to digest financial earnings and economic reports.

Alcatel slumps on Nokia bid

In other stock news, shares of Alcatel-Lucent finished around 15 percent lower after Nokia confirmed it planned to buy the Franco-American telecom company for 15.6 billion euros ($16.6 billion). This reversed a similar-sized rally on Tuesday after "advanced" deal talks were announced.

Media reports suggested Alcatel shareholders were disappointed because they had hoped for a part-cash offer. S&P Capital IQ cut its rating on Alcatel to "hold" from "buy."

Nokia shares rallied as much as 2 percent, before slipping to close around 1.5 percent lower.

Read MoreNokia confident Alcatel buy will get green light

Ireland's Smurfit Kappa slipped around 2.7 percent after the paper manufacturer announced it was acquiring the U.K.'s Inspirepac.

Shares of JD Sports shot up over 5 percent after the U.K. fashion retailer announced a jump in profits; Burberry shares rose up to 2.6 percent after a solid trading update on Wednesday.

Danone shares rose over 2 percent after the French food manufacturer released sales figures for its first quarter that beat expectations.

Weak China data

A keenly-awaited reading on China's economy showed first-quarter growth at its slowest pace since the global financial crisis on Wednesday.

Gross domestic product expanded 7 percent in the three months to March from the year ago period, according to figures from the National Bureau of Statistics, in line with forecasts and down from 7.3 percent in the previous quarter.

Further data out of China on Wednesday included factory output, fixed asset investment and retail sales for March, all of which came in below market consensus.