Picture used for illustrative purpose. File
A fourth day of gains in retail stocks nudged European equities higher on Wednesday as Zara-owner Inditex posted a quarterly profit, although UK blue-chip stocks came under pressure after a surge in the previous session.
The pan-European STOXX 600 index inched 0.3% higher, extending a winning run this week.
Inditex said current trade showed a progressive return to normality with online sales growing sharply and store sales recovering, pushing its shares 6.3% higher. The retail sector was up 1.1%.
London's blue-chip shares were dragged lower by a weakness in the banking sector. A bright spot in the market was a 26.4% surge in shares of the Hut Group, the first major British initial public offering in seven years.
Signs of compromise emerged on the Brexit front, with Reuters reporting that Britain offered tentative concessions on fisheries in trade talks with the European Union last week, just as London was threatening to breach the terms of its divorce deal with the bloc.
"The only catalyst that I can see for European equities is Brexit that could push markets one way or the other," said Julien Lafargue, head of equity strategy at Barclays Private Bank.
"Europe, in our mind, is a trading market. You want to buy Europe when everybody hates it, you want to sell it when everybody loves it. At this stage, we're at a neutral."
After a bounce from March lows, the STOXX 600 has been stuck in a range even as Wall Street has hit record highs as investors fret about a resurgence in coronavirus cases and its impact on a nascent economic recovery.
Markets globally appeared to be in a holding pattern ahead of the U.S. Federal Reserve's policy announcement, which is due at 1800 GMT.
Investors are expecting somewhat rosier economic forecasts from the central bank, with a renewed pledge to keep interest rates low for as long as the U.S. economy needs to recover from a pandemic-driven downturn.
Swiss plumbing materials company Geberit rose 1% after saying it would buy back shares worth up to 500 million Swiss francs ($551 million) over two years.
Sweden's Handelsbanken rose 2.6% after revealing plans to close almost half of its branches and cut about 1,000 jobs over the next two years.
London's benchmark FTSE 100 index of major blue-chip companies rose 0.3 per cent to 6,225.61 points compared with the closing level on Wednesday.
The pan-European STOXX 600 index fell 1.9%, on track for its biggest one-day drop in a month, pushing it to a weekly loss for the first time in four weeks.
The pan-European STOXX 600 index were up 0.1% at 0714 GMT, with technology, automakers and oil & gas firms leading the gains.
The pan-European STOXX 600 index was flat, while travel and leisure stocks shed the most among sectors with a 2.4% fall.
The dollar gave up gains made after the Federal Reserve upgraded its 2020 economic forecast this week to trade in negative territory on Thursday. It was last quoted at 92.923 against a basket of major currencies, on track for a 0.3% weekly loss.
Retail sales volumes rose by 0.8% in August, the Office for National Statistics said - slightly above the average 0.7% forecast in a Reuters poll - and, compared with a year earlier, they were up 2.8%, just below forecasts of 3.0% annual growth.
The benchmark Nikkei 225 index added 0.18 per cent, or 40.93 points, to close at 23,360.30 for a weekly loss of 0.20 per cent. The broader Topix index finished 0.49 per cent, or 8.02 points, higher at 1,646.42 for a weekly gain of 0.60 per cent.