European stocks slip lower, oil at 13-month peaks

·2-min read
Stock market gains last week might have captured most of the renewed enthusiasm that investors had to offer, one analyst said

European and US stocks ran out of steam on Wednesday, while oil prices hit 13-month highs.

Investors remain upbeat about the chances of US President Joe Biden pushing through his $1.9 trillion economic rescue package but some have begun to worry it might fan inflation.

Analysts say that a lower-than-expected rise in the US consumer price index Wednesday will likely ensure that the Federal Reserve maintains its posture for low interest rates, which has helped stock prices.

In midday New York trades, the Dow Jones Industrial Average was essentially unchanged after initially rising when the day began.

Oil prices struck 13-month peaks meanwhile as dealers bet on rebounding demand.

Bitcoin dipped to around $44,700 after setting a record close to $50,000 on Tuesday, while the dollar was mixed against other major currencies.

Europe's major equity markets were also softer.

Falling coronavirus infection rates, expanding vaccination programmes and the prospect of a huge US spending splurge provided only limited support as traders held back following strong rises last week.

"Despite notable market drivers in the form of the US stimulus plans and ongoing coronavirus vaccination programme, the gains seen last week appear to have captured much of that initial improvement in sentiment," said Joshua Mahony, senior market analyst at online trading group IG.

"Instead, we appear to be in a holding pattern as markets await a breakthrough in stimulus talks."

Asian stock markets closed higher with eyes firmly on the longer-term outlook for the global economy, as lockdowns are eased and life slowly improves.

Worries remain, however, that markets may have gone a little too far, which analysts said was capping any surge for now.

Hong Kong led Asia's rally, adding 1.9 percent thanks to a surge in Tencent and NetEase following news Chinese authorities had given the green light to their most eagerly awaited video games.

- Key figures around 1645 GMT -

New York - Dow: FLAT at 31,375.52 points

EURO STOXX 50: DOWN 0.3 percent at 3,648.83

London - FTSE 100: DOWN 0.2 percent at 6,518.15 (close)

Frankfurt - DAX 30: DOWN 0.6 percent at 13,930.76 (close)

Paris - CAC 40: DOWN 0.4 percent at 5,670.80 (close)

Tokyo - Nikkei 225: UP 0.2 percent at 29,562.93 (close)

Hong Kong - Hang Seng: UP 1.9 percent at 30,038.72 (close)

Shanghai - Composite: UP 1.4 percent at 3,655.09 (close)

Pound/dollar: UP at $1.3844 from $1.3817 at 2200 GMT

Euro/dollar: UP at $1.2131 from $1.2119

Euro/pound: DOWN at 87.62 pence from 87.71 pence

Dollar/yen: UP at 104.67 yen from 104.59 yen

Brent North Sea crude: UP 0.8 percent at $61.55 per barrel

West Texas Intermediate: UP 0.7 percent at $58.75 per barrel

burs-wai/rl