European shares recovered in late session to end slightly higher on Thursday as upbeat U.S. economic figures and news that Greece and its international lenders had agreed on budget cuts worth 325 million euros (269.5 million pounds) prompted investors to come back to equities.
The FTSEurofirst 300 <.FTEU3> index of top European shares provisionally closed 0.1 percent higher at 1,076.51 points after falling to 1,064.64. Media shares <.SXMP>, up 1.1 percent, were the top gainers, boosted by a 2.8 percent rise in Reed Elsevier
The FTSEurofirst index spent most of the session in negative territory as Greece faced hurdles in its efforts to secure a bailout. However, government sources later said the country and its international lenders had agreed how to achieve budget cut worth 325 million euros.
It's a long and hard struggle, but the general view is that eventually there would be some solution because a Greek default is not in the interest of the euro zone members such as Germany, said Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels.
Volumes are light. People don't want to go short ahead of the weekend as some more positive news could emerge from Greece in the coming days. U.S. economic data also helped the market and we could see some modest upward action in the stock market on Friday.
Figures showed U.S. jobless claims unexpectedly fell last week to a near four-year low, while January housing starts came in better than forecast. The pace of factory activity in the U.S. Mid-Atlantic region gained momentum in February as new orders picked up.
(Reporting by Atul Prakash)