European stocks swing as markets digest rise in German bund yields; Tsipras to meet Merkel in Brussels

On Wednesday European stocks fluctuated between small gains and losses, as market players digested a rise in German bund yields, while being concerned over uncertainty in Greece. Investors will be focusing on the upcoming meeting between Greek Prime Minister Alexis Tsipras, German Chancellor Angela Merkel and French President Francois Hollande in Brussels who will seek progress on debt talks.

The Stoxx Europe 600 index edged higher at 357.82, after logging its longest losing streak since December on Tuesday.

The benchmark 10-year Bund yield, which moves in the opposite direction to the price, edged above the 1 percent mark on Wednesday. Bund yields surged this month trading currently more than double the level it traded at the start of the month.

Over the past week, a selloff in European government bonds and mounting concerns that Greece may not be able to reach a deal with creditors have weighed heavily on stocks, with the pan-European benchmark ending lower for a sixth straight session on Tuesday.

Stocks fell in recent days as Greece struggles to strike a debt deal.

Lars Kreckel, Legal & General Investment Management’s global-equity strategist in London said to Bloomberg that European stocks should rebound after "we get through this."

“There was a very strong consensus that Europe was the best place to be and positioning was crowded. In that kind of context, some disappointments can lead to a bit of a pullback - the Greek situation is getting a bit closer to crunch time and that made people nervous.”

Ian Williams, economist and strategist at brokerage Peel Hunt commented to MarketWatch that "the path of resistance for global equity markets now seems to be downwards and, unless there is a sudden change of stance by one or both sides which prompts a compromise in Greece, it is difficult to see sentiment reversing in the near future.”

Meanwhile, Wall Street is expected to open higher on Wednesday on the back of a weaker dollar and with investors looking ahead to key data later in the week.

The Dow Jones Industrial Average gained 47 points, or 0.3%, to 17,814.

The S&P 500 index picked up 6.65 points, or 0.3%, to 2,086.75.

Futures for the Nasdaq 100 index climbed 14.50 points, or 0.3%, to 4,446.00.