By Ishaq Siddiqi
European stock markets ended modestly higher Monday as European leaders continued to grope toward a rescue package for debt-riddled Greece. The euro slumped against the dollar, while oil and gold prices were little changed.
With much of Asia closed for the Lunar New Year holiday, U.S. markets closed for Presidents Day and EU finance ministers meeting ahead of Tuesday's Economic and Financial Affairs Council meeting, market action was muted.
European Union finance ministers on Tuesday will discuss additional measures that Greece should take to tackle its fiscal crisis beyond what it has already promised to do in order to comply with EU budget rules. Euro-zone finance ministers will discuss whether a goal set by the EU for Greece to cut its budget deficit by 4% in 2010 is attainable, Luxembourg Prime Minister and Finance Minister Jean-Claude Juncker said Monday. If it isn't, extra steps may be needed, said Mr. Juncker, who is also chair of the Eurogroup of euro-zone finance ministers.
Although analysts don't expect any breakthrough when the meeting ends Tuesday, the Greek debt issue remains a driving force of sentiment.
Greek officials have upped the ante by suggesting they won't consider any further austerity measures until the middle of March, when the European Union, the European Central Bank and the International Monetary Fund are scheduled to carry out an audit of its debt-cutting program.
In stock markets, the pan-European Stoxx 600 index closed up 0.3% at 241.10, while the U.K.'s FTSE 100 index closed 0.5% higher at 5167.47. France's CAC-40 index was up 0.2% at 3609.22. Germany's DAX was up 0.2% to finish at 5511.10.
In the currency and bond markets, the euro remained under pressure, while German bunds and U.K. gilts traded modestly lower.
At the time of the European stock markets' close, the euro was at $1.3613, from $1.3632 late Friday in New York. The dollar was unchanged at 89.95 yen.
In commodities markets , sweet crude for March delivery was up 17 cents at $73.96 per barrel on the New York Mercantile Exchange.
April gold futures were higher. The precious metal was up around 1% at $1,101.30 per troy ounce, late in Europe.
Among stocks , British Airways jumped 2.6%. Over the weekend, AMR Corp.'s American Airlines said the U.S. Department of Transportation has tentatively approved a proposed transatlantic travel alliance with British Airways and other partners.
German-based tourism firm Tui /zigman2/quotes/206714402/delayed DE:TUI1 -5.99% AG climbed 9.3% after reporting that its fiscal first-quarter net loss narrowed.
French industrial gases group Air Liquide rose 1.3% after reporting its 2009 net income rose 0.8% due to efficiency gains.
Renault /zigman2/quotes/200919924/delayed FR:RNO -3.45% shares jumped 2.4% after the French auto maker was upgraded to overweight from underweight by Morgan Stanley. The broker said the three cash-flow issues that kept it underweight have begun to recede.
Shares of Norwegian fertilizer group Yara International /zigman2/quotes/200075065/delayed NO:YAR -1.69% dropped 6.9%. It said it will pay $4.1 billion for Terra Industries Inc. Yara said the deal will improve its position in the U.S.
British engineering services firm VT Group closed 15% higher. The rise came after engineering services provider Babcock International Group /zigman2/quotes/200965934/delayed UK:BAB -2.66% said it had made an "indicative proposal" to acquire VT Group.
Babcock, which declined 8.8%, said the VT board had rejected the proposal and declined to enter into discussions with Babcock.
Sarah Turner contributed to this article.
Write to Ishaq Siddiqi at Ishaq.Siddiqi@wsj.com