LONDON, Jan 16 (Reuters) - European stocks consolidated near a 5-1/2 year high on Thursday as indications that the U.S. economy is strengthening and a bullish production update from Rio Tinto offset some weak trading in the consumer sector.
Basic resources shares rose 1 percent as Rio Tinto, the world’s no. 2 iron ore miner, recorded big increases in production, betting China’s economic growth will provide a ready market for decades to come.
Also supporting sentiment, the Federal Reserve said in its Beige Book published late on Wednesday the U.S. economy continued to grow at a moderate pace from late November through the end of 2013, with some regions of the country expecting a pick-up in growth.
Corporate figures in the European consumer sector, however, were less upbeat after both Dutch grocer Ahold and luxury group Richemont reported lower than expected quarterly sales, sending the shares down 2.6 percent and 3.4 percent, respectively.
The broader FTSEurofirst 300 index of pan-European shares was flat 1,339.84 at 0808 GMT, after hitting a 5-1/2 year high in the previous session.
Mike Reuter, global equity broker at Tradition, expected the market to tick higher as the day progressed, provided euro zone inflation data due at 1000 GMT did not disappoint.