European markets mixed as global tension swells

European stock markets closed with mixed results Friday, as edgy investors reacted to the crash of a Malaysian passenger plane in Ukraine that killed almost 300 people and an Israeli assault in Gaza.
When a volatile week of trading finally wound to a close, London's benchmark FTSE 100 had gained 0.17 percent on the day to 6,749.45 points.
In Frankfurt, the DAX 30 index was 0.35 percent lower at 9,720.02 while the Paris CAC 40 added 0.44 percent to 4,335.31.
Milan's stock index rose by 0.65 percent, but the index in Madrid gave up 0.15 percent.
A Capital Economics research note said: "The relatively muted market reaction in the financial markets so far to the latest tragic turn in the crisis in Ukraine -- as well as the escalation of the conflict in Gaza... might suggest that investor sentiment is largely immune to geopolitical risks.
"But we remain wary. The Ukraine crisis in particular could still unfold in many ways."
In midday trading in New York, US stocks benefitted from better-than-expected IBM earnings and generally good results from Google.
The Dow Jones Industrial Average was up 0.29 percent at 17,025.94.
The broad-based S&P 500 gained 0.40 percent at 1,966.01, while the tech-rich Nasdaq Composite Index climbed 0.57 percent to 4,388.43.
- IMF warning -
Meanwhile, the IMF warned that the Ukrainian economy was being badly damaged by the crisis there, and said it now expected the economy to shrink by 6.5 percent this year instead of 5.0 percent.
In Paris, the head of the International Monetary Fund, Christine Lagarde, cautioned that European asset markets might be overvalued relative to fundamental economic indicators, and also said that unduly low inflation could badly damage European growth.
In Asia, markets had fallen for the most part after the disaster in Ukraine sparked geopolitical tensions.
Hong Kong dropped 0.28 percent, Tokyo sank 1.0 percent and Seoul slid 0.07 percent, while Sydney ended 0.17 percent higher.
Airline stocks retreated, led by a slump in already under-pressure Malaysia Airlines as the company faced up to its second major disaster in four months.
Shares in Malaysia Airlines tumbled more than 11 percent on the news, a little more than four months after flight MH370 went missing with hundreds on board in a remote part of the Indian Ocean.
On Thursday, the Malaysian Airlines Boeing 777 smashed into cornfields in a separatist-held region of eastern Ukraine, killing all 298 passengers and crew.
In Paris, shares in Air France-KLM fell by 2.08 percent to 8.59 euros, while Lufthansa's stock was 1.06 percent lower at 14.45 euros in Frankfurt.
On Friday, US President Barack Obama termed the crash "an outrage of unspeakable proportions".
He added: "Evidence indicates that the plane was shot down by a surface-to-air missile that was launched from an area that is controlled by Russian-backed separatists inside of Ukraine."
While underscoring that the full picture had yet to emerge, Obama also highlighted that the pro-Russian rebels have in the past downed Ukrainian aircraft.
Many countries in Asia, Europe and the Americas have demanded an independent, unimpeded international inquiry into the crash.
In bond markets, the rate on the benchmark 10-year German Bund stood at 1.155 percent when government debt trades closed, up from 1.149 percent on Thursday.
Oil prices also gained meanwhile, and on London's Intercontinental Exchange, Brent North Sea crude for delivery in September rose to $107.66 per barrel on Friday from $106.99 for the August contract one week earlier.
On foreign exchange markets, the European single currency slipped to $1.3512, from $1.3525 late Thursday in New York.
The British pound fell to $1.7071 from $1.7100 on Thursday. The euro edged up to 79.15 pence from 79.09 pence.
In commodity deals, gold advanced to $1,307.25 per ounce from $1,302.50 on Thursday, when it had spiked by $20 at one stage following the plane crash.