European markets retreated slightly in the afternoon after data out of the U.S. showed the GDP grew at an annualized rate of just 1.2% in the second quarter. Economist were expecting something around 2.6% growth mark.

Data out of the eurozone wasn't much better.

GDP growth in the eurozone fell to 0.3% in the second quarter, preliminary data from Eurostat showed. This was down from growth of 0.6% in the first quarter of the year.

Growth in the region was pulled down stagnation in the French economy.

Inflation in the eurozone reached its highest level in eight months. Eurostat data showed a reading of 0.2% in July, better than the 0.1% expected by economists.

But the region's benchmark indices pared losses to end the day much where they started.

In London, the FTSE 100 closed 0.05% up at 6,724.43.

The benchmark's biggest gainer was Barclays (BCS) - Get Report , which was up 5.5% after reporting healthy profit in its core business in the second half. However, group profit was dragged down 21% by disposals in the non-core business.

SABMiller (SBMRY) shares gained more than 2% on the announcement that the board had accepted AB InBev's increased takeover offer.

In Frankfurt, the Dax was up 0.61% at 10,337.50 and the Cac 40 ended the day at 4,439.81, 0.44% up.

Shares in the French energy company EDF (ECIFY) jumped well over 9% this morning after profit in the first half beat expectations. The company recorded profit of €3 billion ($3.33 billion) in the first half, above the €2.22 billion expected.

The company's board yesterday approved plans to build £18 billion ($23.7 billion) nuclear reactor at Hinkley Point in southwest England after the dramatic departure of a board member opposed to the deal. But the U.K. government last night said it would delay final approval by conducting a new review.

Shares in luxury good maker Kering (PPRUY) surged 6% on second-quarter results, released after the market closed yesterday. Revenue grew by 6.9% in the second quarter to €2.94 billion.

Gucci saw sales rise by 7.4% in the quarter to €1.05 billion. Analysts were hoping for growth of 2%. Sales at Yves Saint Laurent were up 22.1% in the quarter.

L'Oreal dropped more than 2% today. The beauty products company behind Maybelline and Urban Decay saw revenue drop 0.6% in the second quarter to €6.34 billion; analysts were expecting €6.42 billion. The earnings report released yesterday after markets closed said sluggish sales in its home country, France, were to blame for the fall.

The European bank index - the SX7E - was 2.63% up today ahead of the release of the much watched stress tests this evening. The test will provide the bottom-line guide of institutions' ability to survive in adverse conditions.

All eyes will be on Italian lenders, especially beleaguered bank Monte dei Paschi (BMDPY) .

The lender ended the day 6.3% up, as it is expected to finalize a private bail-out plan before the results of the stress tests are announced.

The board is reportedly set to reject a plan put forward yesterday by Swiss bank UBS and Italian businessman Corrado Passera. The board has instead approved the original plan drafted by JP Morgan and investment bank up , theFinancial Times reported.

Sources told Reuters that the JP Morgan deal includes a €5 billion ($5.6 billion) share issuance and a €10 billion sale of non-performing loans.