The data were "encouraging" according to Naeem Aslam, chief market analyst at Ava Trade, but he said that Greece would continue to weigh on market sentiment, after the anti-austerity party Syriza won a general election Sunday.
"Greek headlines are very much dominating the headlines today and this is the center of focus. Traders are punishing the banking sector, especially in Greek market, which could be under trouble very soon as the liquidity issues surface soon," he added.
Meanwhile, Jennifer McKeown, senior European economist at Capital Economics, said the rise in the Ifo index suggested that fears about a possible Greek crisis affecting Germany had been offset by the perceived benefits of a weaker euro and quantitative easing by the European Central Bank.
