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Europe to Shrug off Greece Pessimism, Open Higher

European shares were indicated to open higher, after overnight gains on Wall Street and in Asia and despite persistent comments that Greece will need fresh money from the European Union.

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Sharon Lorimer

Stocks closed higher on Tuesday with sharp gains for banks on optimism they are not set to suffer an imminent writedown on their Greek debt holdings, and miners up as strong Chinese trade data fueled growth hopes, Reuters said.

On Wednesday, investors will look out for German April inflation data as well as the Bank of England's inflation report.

The report may cause markets to think again about how long interest rates will stay on hold in the UK, even though the short-term outlook is likely to be gloomy.

"With the UK recovery still sluggish and inflation still marching higher, rates look to be on hold for the near future as the MPC wait for a more solid economy before hiking, but traders are becoming concerned that in the meantime the UK is entering into an extended period of stagflation instead," Jonathan Sudaria, a dealer at London Capital Group, said in a market note.

Greece remains in focus on Wednesday. The country's private sector umbrella union has called a 24-hour strike to protest the government's latest austerity measures.