European Stocks Dip Ahead of Election Results

Caution ahead of election results kept European markets in a holding pattern Friday, with stocks edging lower after gains earlier in the week.
The Stoxx Europe 600 index was down 0.2% in early trade as polls for the European parliament entered their second day.
Anti-European Union parties are expected to put in a strong showing at a time when the region's economic recovery is still fragile. Data on Thursday showed that business activity in the euro zone continued to grow in May, but at a slower pace.
The U.K.'s FTSE 100 was down 0.2%, and Germany's DAX was off 0.1%.
Bond markets showed a muted reaction after Spain and Greece saw their credit ratings raised by Standard & Poor's Ratings Services and Fitch Ratings. Spanish and Italian debt gained slightly, continuing to recover from its recent selloff, while Greek bonds were steady.
"The rating upgrades for Spain and Greece are positive but the short-term outlook ahead of the weekend still looks shaky with election risk looming large," said interest-rate strategists at Commerzbank.
Spain's 10-year yield fell 0.04 percentage point to 3.01%, still well above its record low of 2.84% last week. Yields fall as prices rise.
Currency markets were largely quiet, with the euro inching lower against the dollar and yen. The common currency has weakened since the European Central Bank hinted that further easing could be on the way next month. The euro traded at $1.3649 against the dollar Friday, close to a three-month low.
In commodities markets, gold was 0.1% higher at $1,295.40, and Brent crude oil was unchanged at $110.37 a barrel.
Write to Tommy Stubbington at tommy.stubbington@wsj.com
23-05-14 0814GMT
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May 23, 2014 04:30 ET (08:30 GMT)

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