European stocks diverge with eyes on Greece

European stocks diverged on Friday as investors mulled growing optimism over Greece which was given a further boost as the EU approved a 7 billion euro bridge loan for Athens.

London's benchmark FTSE 100 index of top companies dipped 0.23 percent to 6,6781.03 points in afternoon deals.

Frankfurt's DAX 30 shed 0.24 percent to 11,689.22 points while the CAC 40 in Paris rose 0.12 percent to 5,127.58 compared with Thursday's close.

In foreign exchange deals, the euro slipped to $1.0859 from $1.0875 late on Thursday in New York.

Markets had advanced Thursday after Greek lawmakers voted in favour of an austerity-laden bailout package and the European Central Bank (ECB) increased emergency funding to Greece's teetering banks.

The European Union formally approved a short-term loan for 7.16 billion euros ($7.77 billion) to Greece on Friday, while offering guarantees to non-euro nations that their taxpayers would not be at risk.

"We have an agreement on bridge financing.... This agreement is backed by the 28 member states," the EU Commissioner for the euro Valdis Dombrovskis said, adding that the bridge loan would allow Greece to meet a huge payment to the European Central Bank on Monday.

In Berlin, Chancellor Angela Merkel Friday made an impassioned plea to German lawmakers to back a new Greece bailout deal that conforms to EU rules and prevents "chaos" in the crisis-hit country.

Merkel, like Greece?s hard-left Prime Minister Alexis Tsipras, faces rebels in her own party ranks, but ultimately won approval from the chamber where her "grand coalition" commands an overwhelming majority.

She said if a compromise over Greece had not been reached, it would have meant "watching on as the country virtually bleeds out, people no longer getting their money, where chaos and violence could be the result".

But analysts said there were still plenty of hurdles ahead on Greece.

"The plan for a third Greek bailout has cleared a number of hurdles over the last week, including provisional approval by the Greek and German parliaments," said Jonathan Loynes at Capital Economics.

"But there are plenty of obstacles yet to be negotiated, including the fiscal targets, the proposed privatisation fund and, above all, debt relief."

- Google pushes Nasdaq record -

US stocks opened mixed but the tech-rich Nasdaq Composite Index hit new record levels in opening trade Friday. powered by Google shares surging 12.6 percent.

Five minutes into trade, the Nasdaq was at 5,189.79 points, up 0.52 percent from Thursday's record close.

The Dow Jones Industrial Average shed 0.35 percent to 18,056.92, while the broad-based S&P 500 slipped 0.06 percent to 2,123.02.

Google's second-quarter earnings climbed two percent to $3.4 billion on an 11 percent rise in revenue to $17.7 billion, helped by strong growth in advertising on mobile platforms.

The surge lifted Google's market capitalisation to around $450 billion, second only to Apple.

Across in Asia on Friday, markets mostly rose on the ECB and Greece's eurozone partners approving more aid to Greek banks and the government.

Hong Kong and Shanghai stocks also rallied as fears over a renewed mainland rout eased.

Tokyo rose 0.25 percent, or 50.80 points, to 20,650.92, marking a five-day winning streak.

Shanghai jumped 3.51 percent in value. The index has now risen for two straight weeks, clawing back some of the huge losses suffered in just under a month after hitting a June 12 peak. Hong Kong stocks won one percent.