AFP – Wall Street whipsawed global investors on Tuesday, with an early burst of enthusiasm petering out as falling oil prices helped send major US indices lower.
The reversal in New York came after European stocks rose on the coattails of bullish investors in Asia. But London fell on sagging energy and mining stocks.
Robust earnings got the day started in New York, as Citibank and UnitedHealth beat analyst expectations, helping send the blue-chip Dow Jones Industrial Average over the 26,000 mark for the first time ever.
But falling oil prices sent energy stocks lower while the troubled industrial giant General Electric tumbled 2.9 percent after reporting a $6.2 billion fourth-quarter writeoff tied to problems in finance arm GE Capital, reviving concerns for the troubled company’s health.
The Dow pared its gains, ending flat at 25,792.86, while the broader S&P 500 fell 0.4 percent and tech-heavy Nasdaq dropped 0.5 percent in the first session of a holiday=shortened week for US markets.
Karl Haeling of LBBW told AFP that Wall Street’s continuing race to new heights appeared unjustified.
"The rally has continued since early 2018 without a real explanation," he said. "The market is exhausted."
London’s FTSE 100 flirted briefly with new all-time high. However, as sterling dropped on official data showing that UK annual inflation pulled back in December from a near six-year peak, dipping to 3.0 percent from 3.1 percent.
But by the afternoon it was trading down and closed 0.2 percent lower.
– British inflation cools –
The euro meanwhile came off a three-year high against the dollar, while oil futures retreated from their highest levels since 2015 that were reached at the start of the week.
That helped Eurozone stocks advance, with the DAX 30 in Frankfurt climbing 0.4 percent.
Chris Beauchamp, chief market analyst at IG trading group, said "sterling’s impressive rally over the past nine months has helped cool imported inflation" into the UK, in turn lessening the prospect of further rate tightening from the Bank of England.
"Perhaps they won’t have to raise rates this year after all, although one reading does not constitute a trend."
In company share price movement on Tuesday, BP shed 2.7 percent after the British energy giant said it will take an additional charge of $1.7 billion (1.4 billion euros) for last year linked to the Gulf of Mexico oil spill disaster in 2010.
Heavyweight miners also were lower, with Rio Tinto down 3.0 percent and BHP Billiton dropping 2.4 percent.
Stock markets mostly rose in Asia, with Hong Kong clocking its highest-ever close. Investors continued to push into equity markets in Asia and maintaining a healthy start to 2018.
Tokyo’s main stocks index climbed one percent to a more than 26-year high and Shanghai added 0.8 percent.
– Key figures around 2200 GMT –
New York – DOW: FLAT at 25,792.86 (close)
New York – S&P 500: DOWN 0.4 percent at 2,776.42 (close)
New York – Nasdaq: DOWN at 0.5 percent at 7,223.69 (close)
London – FTSE 100: DOWN 0.2 percent at 7,755.93 points (close)
Frankfurt – DAX 30: UP 0.4 percent at 13,246.33 (close)
Paris – CAC 40: UP 0.07 percent at 5,513.82 (close)
EURO STOXX 50: UP 0.3 percent at 3,622.01 (close)
Tokyo – Nikkei 225: UP 1.0 percent at 23,951.81 (close)
Hong Kong – Hang Seng: UP 1.8 percent at 31,904.75 (close)
Shanghai – Composite: UP 0.8 percent at 3,436.59 (close)
Euro/dollar: DOWN at $1.2259 from $1.2265
Pound/dollar: DOWN at $1.3794 from $1.3795
Dollar/yen: DOWN at 110.53 yen from 110.54 yen
Oil – Brent North Sea: DOWN $1.11 at $69.15 per barrel
Oil – West Texas Intermediate: DOWN $1.08 cents at $63.73