Greece Clouds European Equities, but Germany Outperforms

European equities turned in a muted performance in the April-June quarter. Investor caution reigned on account of sovereign debt concerns relating mainly to Greece but also other nations such as Ireland, Spain, and Portugal.

In the three-month period, Britain's FTSE gained 0.6%, while France's CAC was roughly flat. Germany's DAX, however, outperformed other key markets, rising 3.3%.

Several mixed cues tugged at stocks' direction with sovereign-debt risks and the still-lingering effects of the Japanese earthquake offsetting largely positive U.S. equities.

The German index, however, was helped by strength in heavyweights such as  Adidas (ADS),  BASF (BAS), MAN (MAN) and  Merck (KGaA), which rose between 6% and 22%, offsetting weakness in banks, utilities, and technology firms.

Elsewhere, stocks traded in a small range for most parts of April and May, but in June concerns in Greece came to a head after the debt-straddled nation, which has already been banished from private markets, required emergency financial assistance to service its immediate obligations.

The European Union and the International Monetary Fund demanded Greece implement spending cuts if it is to get emergency funds--a move the Greek parliament finally voted in favor of, despite widespread domestic protests.

Financial stocks were hit badly as speculation over their exposure to the debt of several troubled European nations continued.

 Barclays (BCS), Credit Agricole (CAT31),  Royal Bank of Scotland (RBS), and Societe Generale erased between 5% and 10%.  Lloyds Banking Group (LLOY) plunged more than 15% during the quarter as weak earnings and a muted outlook weighed on investor sentiment.

After seeing a brisk rise at the start of the year, commodity prices came under pressure after data showed the U.S. economy could be slowing down, coupled with concerns of a slowdown in China as well.

Weakening metal prices took a toll on miners with  BHP Billiton (BLT), which declined 2.9%, while smaller players like  Xstrata (XTA),  Anglo American (AAL), Lonmin (LMI) and Vedanta (VED) fell between 5% and 13%.

Automakers turned in mixed performance, as some were more affected by supply-chain issues arising out of the Japanese disaster in March.  BMW (BMW) rose 12% in Germany, Audi (NSU) lost 3%, while  Daimler (DAI) was flat.

Meanwhile, shares of Finnish mobile maker  Nokia (NOK) plunged over 25% as it battled supply-chain woes along with a fast-declining market share in the face of competition from  Apple's (AAPL) iPhone and smartphones based on  Google's (GOOG) Android operating system.