Europe Markets

Europe closes higher; Greece and Fed in focus

Europe closes higher; Greece and Fed in focus

European shares closed higher on Wednesday, but markets struggled to gain momentum amid worries about cash-strapped Greece and as focused turned to the release of the minutes from the U.S. Federal Reserve's last meeting.

Comments from a Greek official that the country may be unable to make an upcoming repayment to the International Monetary Fund, helped send the euro to a three-week low against the dollar and undermined sentiment in equity markets.

Read MoreHistory tells us howthe Greek drama could end

The pan-European FTSEurofirst 300 finished 0.5 percent higher, with Germany's benchmark DAX closing flat, the French CAC ticking around 0.3 percent higher, with London's FTSE index ending around 0.2 percent higher.

Banks hit with rate rigging fines

Among the day's big movers were UBS. Its shares rose more than 3 percent after the Swiss bank said on Wednesday it had agreed to pay $545 million in combined fines and plead guilty to one count of wire fraud in a separate matter in a settlement with U.S. authorities over alleged rigging of the currency markets.

Read MoreUBS to pay $545M over forex, libor probes

JPMorgan Chase, Citigroup, Barclay's, RBS and UBS a total of more than $5.5 billion for , the U.S. Department of Justice said on Wednesday.

Shares in RBS and Barclays both rallied after the fines, climbing around 2 percent and over 3 percent respectively.

Merger and acquisitions were also in the spotlight with French telecoms group Altice saying it had agreed to buy Suddenlink Communications in a deal valuing the company at $9.1 billion, to break into the fast-growing U.S. cable sector.

Read MoreAltice enters US cable market with Suddenlink buy

In addition to the news about Altice, Vodafone shares soared almost 5 percent on hopes of a tie-up with cable firm Liberty Global after Bloomberg reported Liberty Chairman John Malone saying on Tuesday that a deal between the two firms would be a "great fit."

"He's been in the business long enough to know the reaction to his remarks," Ian Whittaker, a media analyst at Liberum, told CNBC, referring to Malone's comments.

"I think he's right that a deal between Vodafone and Liberty makes a huge amount of sense. Obviously Liberty has mainly concentrated on fixed-line networks and cable. Vodafone has been looking for a strategy and its strength is mobile," he added.

Spotlight on Fed

Fed minutes: Do they really matter?

U.S. stocks traded lower on Wednesday following a record close on the Dow as investors awaited the afternoon release of the Fed meeting minutes.

Minutes from the Fed's April meeting, due out later this session, are expected to sound a dovish tone. They will be closely watched for clues on the timing of interest rate hikes, along with a speech from the central bank's chair, Janet Yellen, this Friday.

The Fed gave a nod to weather-related weakness in the first quarter after its April meeting, but that statement was also released before a whole batch of disappointing reports including April's retail sales.

European markets posted strong gains Tuesday, boosted by comments from a European Central Bank executive that the ECB would accelerate the pace of money printing over the next two months for its asset purchase program.

Concerns about Greece lingered as reform-for-aid talks continued. Greece will not be able to make a payment to the IMF that is due on June 5 if a deal with creditors is not reached, Reuters reported Greece's parliamentary speaker saying Wednesday.

Ratings agency Moody's meanwhile published a report in which it said the outlook for Greece's banking sector was negative and that there was a likelihood that capital controls and a deposit freeze could be imposed.

Read More'High likelihood' of Greek capital controls: Moody's

The benchmark Greek bourse, down 23 percent over the past year, closed around 0.7 percent lower on Wednesday.

Burberry slumps, M&S profit rise

Elsewhere, markets digested a slew of earnings from Burberry, Britvic, Cable & Wireless Communications, , Thomas Cook Group, SSE and Hargreaves Lansdown.

Thomas Cook, which reported a narrower first-half loss than expected, said the travel firm was not seeing an impact from calls on social media for a on one of its holidays in 2006.

Shares in Burberry tumbled 5 percent after the British luxury goods maker lowered its 2016 retail and wholesale profit guidance due to foreign exchange movements and said it was seeing increased uncertainty in some markets.

U.K. high street retailer Marks & Spencer posted its first rise in annual profit in four years and said it would return excess cash to shareholders. The company said it made a profit before tax and one-off items of 661.2 million pounds ($1.02 billion) in the year to March 28.

That was towards the upper end of analyst expectations, helping lift M&S share price 0.3 percent after initial falls.

Follow us on Twitter: @CNBCWorld