New York / London -
Global shares firmed on Wednesday as signs of economic resilience in
Europe and underlying strength in the US economy offset concerns about
the uncertain prospects for a bailout of Greece, a challenge that weighed on the euro.
Overall US industrial output
was unexpectedly flat in January, but the second straight month of gains
in the manufacturing component pointed to a strengthening economy, data
from the Federal Reserve showed.
"Clearly
the headline (overall) number is disappointing. However, the healthy
upward revision to December on balance is offsetting some of the
headline disappointment," said Omer Esiner, chief market analyst at
Commonwealth Foreign Exchange in Washington.
"Overall the vast majority of data recently has been positive, so I am not too concerned about this one outlier."
Also
lifting sentiment was a New York Federal Reserve report that showed a
gauge of manufacturing in New York state picked up in February to its
highest level in more than 1-1/2 years, although the pace of new orders
slowed.
The Dow and S&P 500 traded near break-even, but the tech-heavy Nasdaq was
higher on better-than-expected earnings from Comcast Corp and another surge in Apple Inc.
The Dow Jones industrial average was down 37.09 points, or 0.29%, at 12 841.19. The Standard & Poor's 500 Index was up 0.52 points, or 0.04%, at 1 351.02. The Nasdaq Composite Index was up 8.35 points, or 0.28%, at 2 940.18.
While
the euro zone economy shrank at the end of 2011 and will flirt with a
mild recession under the weight of the sovereign debt crisis, strength
in France and resilience in Germany provided investors some optimism.
German
gross domestic product contracted 0.2% in the fourth quarter,
topping forecasts, while the French economy grew more than expected as
corporate investment picked up and domestic consumption remain solid.
But European shares pared gains after eurozone
sources said officials were considering delaying parts or even all of
the second bailout program for Greece possibly until after the country
holds elections in April.
Bank
stocks, which have been a barometer of investment sentiment due to their
exposure to euro zone debt, pared gains, although the STOXX Europe 600
Banks index was still up 1.2%.
"It's
a never-ending spiral of mistrust and ping pong," said Gerard Lane,
equity strategist at Shore Capital. "For general sentiment, it's quite
poor."
The FTSEurofirst 300 index was up 0.3% at 1 073.36, paring earlier gains that had pushed
the index of leading European shares to a session high of 1 080.30.
The euro slid to its lowest in more than a week against the dollar after on news of the possible delay to the bailout.
The single currency eased 0.4%, falling back below $1.31 to $1.3081.
Since
late December the European Central Bank has moved to supply banks with
large amounts of cheap money, the U.S. Federal Reserve has committed to
keeping rates low until 2014 and the Bank of Japan and the Bank of England have announced further policy easing measures to help the global economy recover.
The
central bank moves have underpinned demand for equities and helped lift
the MSCI world equity index by over nine percent for the
year to date. The index was up 0.5% on Wednesday.
Oil hit a six-month high near $120 a barrel as concern about supply from Iran, other Middle East producers and Africa outweighed those about the health of the global economy.
Brent crude was up $1.55 at $118.90 a barrel. U.S. crude rose 84 cents to $101.58.