European stocks edged higher Thursday but with political risks still lurking underneath solid economic fundamentals, gains were limited and volumes were thin as investors prepare for upcoming elections in France and potentially divisive Brexit negotiations between London and Brussels.

Britain's FTSE 100 led major benchmarks around the region with a 0.25% gain in the opening 30 minutes of trading, but the mixed collection of stocks and sectors at the top of the gainers list suggested no real narrative in early trading. Germany's DAX performance index added 10 points from the start of the session, but gains were limited by a 4% decline for Daimler AG  (DDAIY) , whose shares now trade without the right to its latest dividend. 

The Stoxx Europe 600 index, the region's broadest measure of share prices, was marked 0.02% higher at 378.59, holding at the highest levels in around 16 months. 

Currency markets in the region were also active, with the euro slipping 0.2% to trade at 1.0745 against the U.S. dollar after softer-than-expected inflation data from Spain and regional consumer price readings from some German states. The pound was also marked lower, trading at 1.2413 against the greenback as investors await the British government's 'white paper' that will outline its specific Brexit priorities. 

An early mover of note in European trading was H&M Hennes & Mauritz AB (HNNMY)  , which posted stronger-than-expected quarterly earnings and said it would launch a new clothing line later this year amid an increasing difficult environment for European retailers.

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However, shares in group fell after analysts noted rising levels of inventories at the group and CFO Jyrki Tervonen warned of potential markdowns as a result.

H&M was marked 2.5% lower at SEK231.2 by 09:45 BST in Stockholm Thursday, extending their three month decline to more than 9% compared to a 0.64% decline for the Stoxx Europe 600 Retail Index.

Stocks in Asia retreated overnight, however, with both Japan's Nikkei 225 (-0.88%) and the broader MSCI Asia ex-Japan (-0.24%) benchmarks posting losses in an otherwise tepid session of trading that was largely dominated by currency and oil market movements.

The U.S. dollar, in that respect, continued its recovery from the early November lows it reached on Monday, with a key measure of its strength against a basket of six rival currencies rising to a nine-day high of 100.60 before paring gains to 99.84 at the start of the European session. The gains were linked to hawkish comments from various Federal Reserve officials, including Charles Evans, who suggested that four rate hikes for the 2017 calendar year are still likely, following the Fed's first increase on March 15.

Global oil prices are also edging higher, with WTI futures for May delivery rising 0.3% to $49.66 per barrel after data from the U.S. Energy Information Agency showed another increase in domestic crude stocks, which now sit at an all-time record of just under 534 million barrels. A surprise dip in gasoline stocks, however, and consistent speculation that OPEC members will agree to an extension of production cuts, has kept a lid on gains.

Early indications from U.S. equity futures are pointing to a similarly muted open on Wall Street, with the Dow Jones Industrial Average expected to add 8 points at the bell after Wednesday's 42 point decline. The broader S&P 500 is expected to rise just under half a point while the Nasdaq is called 7 points higher.