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LONDON (Alliance News) - The FTSE 100 closed higher Wednesday, shrugging off renewed uncertainty surrounding a potential Greek exit from the eurozone and a lower open on Wall Street, meaning that it has now ended in positive territory for five days in a row.

Greece was once again centre of attention Wednesday, with the debt-laden country and its international creditors holding crucial talks in Brussels in an attempt to reach an agreement over new reform proposals to be presented for approval at a meeting of Eurozone finance ministers later in the day.

European Commission President Jean-Claude Juncker, European Central Bank President Mario Draghi, International Monetary Fund Managing Director Christine Lagarde and Eurogroup Chief Jeroen Dijsselbloem held talks in Brussels. They will be joined by Greek Prime Minister Alexis Tsipras later on.

Meanwhile, Tsipras rekindled 'Grexit' fears as he left for Brussels. He told lawmakers in Athens that creditors rejected some of the reform proposals submitted on Monday, which had initially raised optimism that a deal was possible this week.

"Just as we thought we were seeing significant progress being made in talks between Greece and its creditors, a Greek government official has claimed that latest proposal has been rejected by creditors raising questions once again around whether a deal will be possible," said Craig Erlam, senior market analyst at Oanda.

The FTSE 100 fell firmly in the immediate aftermath of reports that Greece's latest proposal had been rejected, but regained much of its strength as the day wore on. The UK's blue-chip index closed up 0.2% at 6,844.8, meaning that it has now risen approximately 2.5% in the past five sessions, while the FTSE 250 closed down 0.4% at 17,924.78 and the AIM All-Share ended the day up 0.1% at 770.96.

On Wall Street, US equities open modestly lower and have continued to trade in negative territory. At the UK equity market close, the DJIA, S&P 50 and NASDAQ Composite are all down between 0.1% and 0.3%. In Europe, meanwhile, the CAC 40 in Paris has closed down 0.1%, while the DAX 30 in Frankfurt ended the day down 0.6%.

Last minute differences between Greece and its creditors over reforms suggest that Wednesday is going to be a very long day of negotiations before a deal is clinched which could unlock EUR7.2 billion aid for the country and help it avoid a default and an eventual exit from the euro. German officials said on Wednesday that there was "still a long way to go" before any deal is agreed.

"Pensions remain a key sticking point, especially for Germany whose voters are understandably disgruntled at funding earlier retirements in Greece," said Jasper Lawler, a market analyst at CMC Markets. "The Greek proposal also heavily relies on raising taxes not cutting spending for producing a budget surplus, but tax collection has not historically been Greece’s forte," he added.

Investors' attention will remain focused on Brussels in the coming days, with EU officials scheduled to attend several meetings replete with challenges straining the bloc. There is an eurogroup meeting scheduled for Wednesday at 2000 BST, while the European Council meeting is starting on Thursday.

In macroeconomic data released Wednesday, the Munich-based IFO Institute revealed that German business confidence weakened to a four-month low in June as Greece crisis weighed on the current situation assessment and expectations of companies. The business confidence index fell to a four-month low of 107.4 in June from 108.5 in May, missing expectations of a more modest fall to 108.1.

Although the IFO survey points to an acceleration in Germany's economy in the second quarter, its fall in June suggests that Greece's crisis is starting to weigh on sentiment there, James Howat, a European economist at Capital Economics, said.

In the US, the Commerce Department revealed that the world's largest economy's gross domestic product dipped by 0.2% in the first quarter compared to the previously reported 0.7% drop. The modest decrease, which came on the heels of 2.2% growth in the fourth quarter, matched economist estimates.

"Revised GDP growth for Q1 exactly matched expectations with a decline of 0.2%, revised up from the preliminary estimate of -0.7%," said Daiwa Capital Markets America's Michael Moran. "Defence spending by the federal government was revised slightly lower, but all other major components were better than previously estimated," he added.

Following the data and at the UK equity market close, the pound traded at USD1.5678 and EUR1.4026, while the euro traded at USD1.1178.

In UK corporate news, Wm Morrison Supermarkets and J Sainsbury ended the day among the leading risers in the FTSE 100 Wednesday.

The supermarkets rose firmly after Belgian food retailer Delhaize Group and Dutch supermarket chain Koninklijke Ahold agreed to combine their businesses in a deal that will create a chain of more than 6,500 stores, sparking thoughts of M&A activity in the UK sector. The deal is expected to close in mid-2016.

Additionally, Societe Generale said it expects Morrisons to continue to underperform the other two in terms of like-for-like sales growth "due in particular to its limited exposure to online and convenience, the two most dynamic segments in the UK grocery market." SocGen analyst Arnaud Joly highlighted that Morrisons needs to clarify its positioning and strengthen its differentiation, saying that he expects more clarification from new Chairman Andrew Higginson and new CEO David Potts in September with the publication of interim results.

SocGen kept its Sell stance on Morrisons, cutting its price target to 150p from 160p. The broker upgraded Sainsbury's to Buy from Hold, raising its price target to 315p from 260p, saying that the grocer's profile is more resilient than many fear. Meanwhile, SocGen said too much uncertainty remains over Tesco to justify a re-rating in the short term, and therefore it keeps a Hold stance and a price target of 235p on the stock.

Shares in Morrisons closed up 2.6% at 184.50 pence, while Sainsbury's closed up 2.3% at 275.50p. Tesco, which had been among the leading risers for much of the day, closed up 0.2% at 216.561p.

Royal Dutch Shell was another big blue-chip winner after Deutsche Bank upgraded the oil and gas company to Buy from Hold following a "torrid" start to the year that has seen the company's share price significantly underperform its peers.

"Our reasons for upgrading Shell are clear," Deutsche says. "In our view the Shell dividend is sustainable; the BG [Group] transaction with all its strategic logic will proceed; the restructuring possibilities at Shell assuming its completion are substantial; management intent to reshape Shell 'legacy' is decided; and with the shares now trading at a 6.3% dividend yield, they are at a level from which we see limited relative or, indeed, absolute downside."

Royal Dutch Shell 'A' shares ended the day up 0.9% at 1,872.80 pence, while its 'B' shares closed up 1.7% at 1,920.30p. BG Group's shares, meanwhile, closed up 1.8%.

Next PLC closed up 1.1% at 7,560.00 pence. Barclays upgraded the fashion retailer to Overweight from Equal Weight, raising its price target to 9,000 pence from 7,400p, saying that its analysis suggests the market under-appreciates the company's growth opportunities in both its Retail and Directory divisions.

At the other end of the spectrum, Sage Group was the biggest loser in the FTSE 100. The software company's shares fell 6.0% after it said the next two to three years are set to be transitional period for the company and said it is planning to cut its general and administrative costs in order to reallocate funds to its investment plans.

In a statement issued ahead of its Capital Markets Day, the company said it intends to shift to a new set of key performance indicators in coming years, focused on attracting new customers to its product range and improving the "quality and sustainability" of its revenue by shifting to a focus on annualised revenue and by growing its subscriber base.

It will also focus on improving its contract renewal rate and will be making investments in its customer-facing activities, with the latter to be funded by a reduction in general and administrative costs as a percentage of its total revenue.

In the FTSE 250, Stagecoach Group, closing up 2.6%, was one of the biggest risers. The transport operator said its pretax profit ticked higher in its 2015 financial year on the back of better revenue from its UK rail business and in spite of mixed fortunes for its UK bus and North American operations, though the group said it would hike its dividend.

Elementis, meanwhile, was the heaviest faller in the mid-cap index, closing down 17%. The specialty chemicals company saw its shares take a beating after it said its earnings per share will miss market expectations as its specialty products arm takes a hit from conditions in the oil and gas markets, weaker coating additives demand in China and local currency weakness in Latin America for its personal care arm.

On AIM, Ascent Resources closed up 29% after it said it has received a provisional Integrated Pollution Prevention and Control Permit from Slovenia's Environmental Authority for the installation of the Gas Gathering and Separation Station at the Petišovci field. Appeals against the permit can be lodged in the next 30 days, Ascent said, but once the permit becomes legally valid, Ascent can start procurement and construction of the station.

In the economic calendar Thursday, German GfK consumer confidence information for July is released at 0700 BST, with the UK Confederation of British Industry's distributive trades survey for June released at 1100 BST.

In the afternoon, US jobs data and personal consumption data are scheduled to be published at 1330 BST, while Markit Economics releases its US composite and services purchasing managers' index data for June at 1445 BST. US Energy Information Administration gas storage change information is due at 1530 BST, with the Federal Reserve Bank of Kansas City's quarterly survey of manufacturing activity scheduled shortly after at 1600 BST.

In the corporate calendar, FTSE 250-listed John Wood Group, Go-Ahead Group and Debenhams are all scheduled to release trading updates Thursday, while DS Smith is set to publish full-year results.

DS Smith is expected to post a rise in full-year pretax profit on Thursday, though analysts expect the company to see a fall in revenue due to the strength of sterling against the euro.

Also of note, UK blue-chips Experian, Compass Group and United Utilities Group are joined by mid-caps JD Sports Fashion, Mercantile Investment Trust, Electrocomponents, MITIE Group, TR Property Investment Trust and Paypoint, amongst others, in going ex-dividend Thursday, meaning new buyers no longer qualify for the latest dividend payout.

By James Kemp; jameskemp@alliancenews.com; @jamespkemp

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