European equities flatten at open

LONDON: Europe’s stock markets flatlined Friday despite earlier gains in Asia, as investors digested upbeat fourth-quarter US economic growth data.

London’s benchmark FTSE 100 index was flat at 7,763.85 points compared with the closing level on Thursday.

In the eurozone, Frankfurt’s DAX was almost unchanged at 15,138.72 points, while the Paris CAC 40 dropped 0.2 percent to 7,082.13.

The world’s biggest economy expanded 2.9 percent in the fourth quarter of last year, exceeding analyst estimates with help from resilient consumer spending.

While the data did not eliminate recession fears, it offered a reason for optimism that the Federal Reserve will manage to lower inflation without tipping the economy into a major downturn.

The Fed hiked its benchmark lending rate seven times last year, in hopes of cooling demand and reining in costs as inflation surged.

European stocks open higher

“There being a time lag between interest rate hikes and the effect on the economy, it remains difficult to predict how much of the Federal Reserve’s actions so far are having the desired dampening effect,” said Interactive Investor analyst Richard Hunter.

“More pessimistic investors are suggesting that the latest quarter of growth could be the last before previous hikes take full effect, potentially pushing the economy towards recession this Spring.”