UKX FTSE 100 Index

By Sara Sjolin, MarketWatch

Pound jumps after U.K. retail sales beat forecasts

European stocks fought for direction on Thursday, with investors cautious of making any big moves amid growing concerns the new U.S. administration will struggle to push through promised pro-business reforms.

The Stoxx Europe 600 index traded 0.1% higher at 374.32, but seesawed between small gains and losses.

The index closed down 0.4% to finish at 374.03 on Wednesday, the lowest close since March 14, as the "Trump trade" that has pushed stock markets higher in recent months started to dwindle. This comes as President Donald Trump faces significant issues with getting approval for his health-care, prompting investors to question his ability to follow through on other promises, such as tax cuts and $1 trillion in infrastructure spending.

A vote on the Republican Party's health-care bill is set for Thursday.

"Without this, Trump can't implement the more exciting pro-growth stimulus policies markets have priced in since his election. Doubts about a favorable voting outcome are the reason for the recent market wobble, although a solid finish on Wall Street restored confidence," analysts at Accendo Markets said in a note.

U.S. stocks closed mostly higher on Wednesday (http://www.marketwatch.com/story/selloff-in-us-stocks-set-to-pick-up-again-as-trump-trade-dwindles-2017-03-22), rebounding from a sharp selloff on Tuesday. U.S. stock futures pointed to a muted open on Thursday.

Movers: Next PLC (NXT.LN) jumped 6.9% after the fashion retailer maintained its final dividend at GBP1.05 and confirmed its guidance for the current year (http://www.marketwatch.com/story/fashion-retailer-next-posts-drop-in-profit-2017-03-23).

Gemalto NV (GTO.AE) fell 3.6%, building on a 17% loss from Wednesday when the digital security firm cut its financial guidance.

Indexes: The U.K.'s FTSE 100 index fell 0.1% to 7,314.48. Investors in London were still digesting the terrorist attack in London on Wednesday afternoon, which left four people, including the attacker, dead and dozens injured.

Read:U.K. police arrest 7 in London terror-attack probe: report (http://www.marketwatch.com/story/uk-police-make-arrests-linked-to-westminster-attack-report-2017-03-23)

The pound jumped as high as $1.2528, from $1.2484 late Wednesday in New York, after data showed U.K. retail sales jumped 1.4% in February (http://www.marketwatch.com/story/uk-retail-sales-surge-14-in-february-2017-03-23). That's more than the 0.4% increased forecast by analysts. The pared has pared the gain to $1.2516.

Germany's DAX 30 index rose 0.2% to 11,924.27, while France's CAC 40 lost 0.2% to 4,985.91.

(END) Dow Jones Newswires

March 23, 2017 06:19 ET (10:19 GMT)

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