Summary Stocks gained despite a surprise drop for eurozone industrial production.
LONDON (AFP) - European stock markets headed higher on Wednesday as traders brushed off poorly-received Asian economic data and focused on events closer to home.
London s benchmark FTSE 100 index rose 0.19 percent to stand at 6,644.99 points in afternoon deals.
Investors reacted to news of a drop in British unemployment amid weak wages growth, which pushed back expectations that Bank of England interest rates would rise as earlier as this year.
That in turn led to sharp falls for sterling against the euro and dollar.
"A significant cut to the Bank of England s wage growth forecast saw sterling crash to a more than two month low against the US dollar, as traders took the revision to mean that the central bank won t hike rates this year, pushing back some forecasts to the start of 2015," said Craig Erlam, market analyst at Alpari traders.
In the eurozone, Frankfurt s DAX 30 was up 1.07 percent to 9,166.30 points on bargain-hunting after the index had slid by more than one percent in value on Tuesday on poor German data.
The CAC 40 in Paris advanced 0.59 percent to 4,187.06 points.
Stocks gained despite a surprise drop for eurozone industrial production.
"Despite June s unexpected weakness, industrial production in the second quarter overall was flat ... thanks to an upward revision to April s data," said Jessica Hinds, European economist at the Capital Economics research group.
US shares also rose as trading got underway in New York, despite a lackluster US retail sales report and some disappointing earnings announcements.
The Dow Jones Industrial Average showed a gain of 0.30 percent to 16,610.96 points, the broader S&P 500 average was up by 0.43 percent at 1,942.13, and the tech-heavy Nasdaq added 0.44 percent to 4,408.75.
Asian stock markets had closed with mixed results earlier in the day as downbeat data from China and Japan sparked renewed concerns for growth in the region s two biggest economies.
Japan s economy shrank by 1.7 percent in the April-June quarter, official data showed, while in China industrial output and retail sales numbers came in slightly slower from the previous month s data.
In foreign exchange trading, the euro rose to $1.3409 from $1.3368 late on Tuesday in New York.
The European single currency jumped to 80.18 pence from 79.51 pence on Tuesday. The pound slid to $1.6725 from $1.6811.
On the London Bullion Market, the price of gold slipped to $1,309.25 an ounce from $1,315.75 on Tuesday.
In corporate news, E.ON held to its full-year forecasts on Wednesday despite a slump in profits in the second quarter and first half for Germany s biggest power supplier.
The group, whose share price leapt by 4.79 percent to 13.80 euros, expressed also confidence that Russia would not raise energy prices in Europe.
Against the backdrop of the Ukraine crisis, the European Union and the United States imposed economic sanctions against Russia at the end of July and Moscow responded by threatening to raise energy prices for European customers.
