European stocks hold gains after Spain auction; DAX up 0.32%

Investing.com - European stock markets held gains on Thursday, but sentiment remained under pressure amid sustained concerns over the debt crisis in Spain although an earlier auction of Spanish government bonds met with high investor demand.

During European morning trade, the EURO STOXX 50 rose 0.16%, France’s CAC 40 climbed 0.35%, while Germany’s DAX 30 advanced 0.32%.

Spain raised slightly more than the full targeted amount of EUR2.5 billion, while the yield on the country’s 10-year bonds remained below the 6% level.

However, the results failed to ease concerns over the outlook for Spain, as Prime Minister Mariano Rajoy's government attempts to reduce one of the largest deficits in the euro zone, amid fears that the economy is entering a recession.

In addition, worries over Spain’s troubled banking sector weighed, after the country’s central bank said Wednesday that the amount of bad loans at domestic banks rose to an 18-year high in February.

Financial stocks were mixed after the auction, as shares in French lender BNP Paribas jumped 1.17% and Germany’s Deutsche Bank climbed 0.58%, while peripheral lenders such as Spanish BBVA and Italian Intesa Sanpaolo lost 0.62% and 0.08% respectively.

Barcelona-based CaixaBank also retreated 2.04% after saying that first-quarter profit fell 84% as it complied with a government order for lenders to recognize losses for real estate.

Meanwhile, Akzo Nobel, the world biggest paint maker, added 0.75% after reporting first-quarter earnings that beat analysts’ estimates as a savings program instigated by departing Chief Executive Officer Hans Wijers took effect.

Also in earnings, Tele2 AB plunged 4.23% after Sweden’s second-largest wireless provider posted first-quarter profit that missed estimates.

In London, FTSE 100 advanced 0.59%, boosted by strong gains in mining stocks.

Bhp Billiton led gains, with shares surging 1.90%, and was closely followed by rival Rio Tinto, up 1.36%, while copper producers Xstrata and Kazakhmys added 0.33% and 1.33% respectively.

Meanwhile, U.K. lenders were mixed. Shares in Barclays fell 0.40% and the Royal Bank of Scotland declined 0.12%, while Lloyds Banking and HSBC Holdings saw shares rise 0.33% and 0.82%.

Elsewhere, Cable & Wireless Worldwide plummeted 18.11% as Vodafone Group became the only potential bidder for the company, after Tata Communications failed to agree on a price and chose not to make an offer for the U.K. network operator.

Shares in Vodafone were up 0.68% after the news.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a rise of 0.45%, S&P 500 futures signaled a 0.47% increase, while the Nasdaq 100 futures indicated a 0.65% gain.

Later in the day, the U.S. was to release official data on unemployment claims, followed by industry data on existing home sales and a report on manufacturing activity in the Philadelphia area.