European stocks were little changed as investors weighed the prospects of success in Greece’s debt talks.
The Stoxx Europe 600 Index fell 0.1 percent to 395.93 at the close of trading. Shares started paring gains of as much as 0.9 percent after European Central Bank President Mario Draghi said there was no credible perspective yet on a Greek deal. Still, the country’s ASE Index added 4.1 percent, for the best performance of the western-European markets, and its biggest rally in more than a month.
“There may have been too much optimism in the markets regarding the Greek negotiations,” said William Hobbs, the London-based head of equity strategy at Barclays Plc’s wealth-management unit. “We still think a deal can be done at the last minute. It will probably look like the last bailout and any concessions must come from Greece. It’s definitely getting towards the end of negotiations because the government is running out of money.”
Greek Prime Minister Alexis Tsipras said he will press creditors to be realistic about what his country can accept as they prepare to deliver a final proposal on its debt. Tsipras, who also put forward his own plan, meets European Commission President Jean-Claude Juncker in Brussels on Wednesday evening.
The ECB kept interest rates on hold at record lows as data signaled that the risk of deflation in the euro area is waning.
Speaking at a press conference after the announcement, Draghi said monetary policy stimulus is filtering through to the real economy, and insisted the central bank needs to stick with the quantitative easing program to its conclusion.
He also unveiled economic forecasts for a pickup in growth and inflation in the next three years similar to the outlook in March, while insisting that it’s dependent on “full implementation” of stimulus.
“It looks like prospects for the second half are good for Europe,” said Hobbs. “Draghi’s point was that he’s more likely to do more than less. Their policy stance is definitely looser rather than tighter.”
Royal Ahold NV gained 5.9 percent and Delhaize Group climbed 7.4 percent after people familiar with the matter said that merger talks between the two retailers are progressing.
Credit Suisse Group AG advanced 3.9 percent. RBC Capital Markets upgraded its rating on the lender to the equivalent of buy, citing the possibility of strategic changes when Tidjane Thiam takes over as chief executive officer next month.
Cable provider Altice SA slid 2.6 percent as rivals Telefonica SA and Bouygues SA set up a joint venture to offer telecommunications services to multinational companies.
Amadeus IT Holding SA, a Spanish operator of travel booking systems, tumbled 9.7 percent, the most in more than five years, after Deutsche Lufthansa AG announced a charge for external bookings.
(An earlier version of this story was corrected to show that the ASE Index didn’t fall this morning.)