(AP) — World stock markets gave up earlier gains Thursday amid ongoing concerns about Greece's budget woes, and after weaker than expected U.S. economic data that reined in hopes about global recovery this year.

The FTSE 100 index of leading British shares was up 24.72 points, or 0.5 percent, at 5,498.20 while Germany's DAX rose 25.74 points, or 0.4 percent, to 5,988.88. The CAC-40 in France was 14.91 points, or 0.4 percent, higher at 4,015.77.

They had traded higher earlier in the session but a fairly subdued performance on Wall Street prompted the modest retracement — the Dow Jones industrial average was trading 12.77 points, or 0.1 percent, higher at 10,693.54 around midday New York time while the broader Standard & Poor's 500 index was unchanged at 1,145.68.

Sentiment in Europe and Asia had been buoyed by a more positive economic assessment in a U.S. Federal Reserve report late Wednesday, but an unexpected decline in U.S. retail sales in December and a bigger than expected increase in new claims for unemployment insurance last week, disappointed investors.

"This has all served to remind investors that any further recovery this year looks likely to be far from plain sailing," said David Jones, chief market strategist at IG Index.

Also weighing on sentiment, particularly in Europe, was continued unease about Greece's attempts to bring its budget deficit down substantially over the coming few years. The Greek cabinet approved an economic recovery plan intended to get the budget deficit to below 3 percent by 2012 and to 2 percent by 2013 through spending cuts and a mainly tax-driven boost in state revenues.

"The (EU) asked us to have an alternative plan ready and we complied with this request," said finance minister George Papaconstantinou. "If additional measures are needed to meet our targets, those measures will be taken."

The blueprint is set to be submitted to both the EU and the European Central Bank by Friday.

Jean-Claude Trichet, the European Central Bank's president, said it was "absurd" to suggest that Greece would leave or be kicked out of the euro but said the country could not expect any special favors from the bank.

It has to sort out its own problems on its own, said Trichet, who added that he had not yet assessed the new Greek proposals.

Trichet was speaking after the central bank left rates unchanged, as expected, at a historic low of 1 percent and indicated that there wouldn't be any increase any time soon.

Elsewhere, investors are also keen to see if the increasing optimism on Wall Street, which has driven a ten-month bull run in stock markets, is justified by the fundamentals.

Germany's SAP said in a preliminary report that its fourth quarter revenue was euro3.18 billion, down 9 percent from a year earlier but still better than it expected. It did not provide a profit figure, but said its operating margin was 32.8 percent.

That raised spirits ahead of another key earnings statement Thursday by Intel, which will reveal its results in an after-hours statement.

Earlier this week, aluminum company Alcoa Inc. saw its share price tumble 11 percent after it reported lower than expected earnings for the fourth quarter.

"After Alcoa's weaker numbers on Monday many will be nervous ahead of this release as any weaker numbers could dent confidence further as fears are already growing that we could see a disappointing earnings season," said James Hughes, market analyst at CMC Markets.

Earlier in Asia, stocks rallied amid receding worries about credit-tightening in China and Australia's economic recovery showed new momentum.

Economists say China is likely to confine tightening to technical tinkering to discourage excess lending and will likely wait some time before raising benchmark interest rates or cutting back on the government stimulus spending credited with helping revive domestic demand and creating jobs.

Japan's Nikkei 225 stock average led Asia's gains, jumping 172.65, or 1.6 percent, to 10,907.68. That was despite news that core machinery orders — a closely watched indicator of corporate capital spending — slumped to a record low in November as anemic domestic demand kept companies cautious.

South Korea's Kospi added 0.9 percent to 1,685.77. Australia's market rose 0.6 percent after new figures showed that the unemployment rate unexpectedly fell to 5.5 percent in December and thousands of new jobs were created.

Singapore's benchmark was up 0.7 percent but Hong Kong's Hang Seng gave up early gains to close down 31.65, or 0.2 percent, at 21,716.95. China's Shanghai index rose 42.89 points, or 1.4 percent, to finish at 3,215.55.

Oil prices fell further back below $80. Benchmark crude for February delivery was down 44 cents at $79.21 in electronic trading on the New York Mercantile Exchange; the contract gave up $1.14 to settle at $79.65 on Wednesday.

The dollar fell 0.3 percent over the day to 91.10 yen while the euro was down 0.3 percent at $1.4475 amid the ongoing Greek concerns.

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AP Business Writers Carlo Piovano in London and Stephen Wright in Bangkok contributed to this report.

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