All-time peaks on Wall Street failed to spur on stock markets in Europe (SPENCER PLATT)

London (AFP) – Europe’s main stock markets wobbled on Wednesday as a record-breaking Wall Street session failed to spark a major global rally.

Bullish earnings and economic data catapulted New York’s S&P 500 and tech-heavy Nasdaq indices to all-time peaks overnight, while the Dow Jones Industrial Average also came close.

Sentiment brightened as a string of better-than-forecast results from the likes of Coca-Cola, Twitter and Lockheed Martin added to a raft of other recent reports that suggest the US economy — the world’s biggest — is in rude health.

Yet Wall Street’s “feelgood factor” failed to translate into significant gains elsewhere, dealers said, while oil prices retreated further from the 2019 highs hit at the start of the week.

– ‘Feelgood factor’ fades –

“While this was a good batch of results, it’s not yet clear whether it’s an outlier or a sign of what’s to come,” Oanda analyst Craig Erlam told AFP in London.

“The boost has only been seen domestically and even here, the feelgood factor has already faded as we head into the open.

“I think we need more evidence that the better results are more widespread before the ripple effect spreads beyond the United States.”

US markets have been boosted after the Federal Reserve last month hinted that it will not raise rates again this year, having signalled as recently as September that it expected to raise rates three times.

“Investor confidence has seemingly returned and done so in style, thanks primarily to the US Federal Reserve’s policy U-turn,” noted investment director Russ Mould at stockbroker AJ Bell.

In Europe, London stocks dipped amid ongoing Brexit uncertainty, while Paris flatlined.

Frankfurt however leapt 0.9 percent, aided by soaring first-quarter revenues and profits for German software and cloud computing giant SAP.

Asian markets mostly rose but investors refrained from firing a full-on rally.

“Although investors might have hoped that record highs in the US would prompt gains in the rest of the world, the current lack of correlation across global markets means that there is less read-across than usual,” Interactive Investor analyst Rebecca O’Keeffe told AFP.

“Suggestions that leaders within China’s ruling party will focus on economic reforms and will hold back on unnecessary stimulus is dampening market sentiment in Asia.”

– Oil beats retreats –

On oil markets, both main contracts were in retreat after hitting six-month highs on the back of news that Washington would end a waiver for several countries from US sanctions on Iran.

Prices had already been surging thanks to hopes for the China-US talks and for an output cap by OPEC and Russia. Unrest in Libya and Venezuela has further propped up prices.

There has been speculation OPEC kingpin Saudi Arabia could step in to fill the void left in the market by the removal of Iranian crude, which would temper prices.

But Saudi energy minister Khalid al-Falih said Wednesday that the kingdom has no immediate plans to raise its oil output.

He said that Riyadh was committed to balancing the oil market and that countries looking to replace Iranian crude “know which number to dial”.

– Key figures around 1045 GMT –

London – FTSE 100: DOWN 0.3 percent at 7,501.30 points 

Frankfurt – DAX 30: UP 0.9 percent at 12,341.37

Paris – CAC 40: FLAT at 5,592.49

EURO STOXX 50: UP 0.3 percent at 3,512.45

Tokyo – Nikkei 225: DOWN 0.3 at 22,200.00 (close)

Hong Kong – Hang Seng: DOWN 0.5 percent at 29,805.83 (close)

Shanghai – Composite: UP 0.1 percent at 3,201.61 (close)

New York – Dow: UP 0.6 percent at 26,656.39 (close)

Euro/dollar: DOWN at $1.1217 from $1.1227 at 2100 GMT on Tuesday

Pound/dollar: DOWN at $1.2933 from $1.2938

Euro/pound: DOWN at 86.74 pence from 86.78 pence

Dollar/yen: DOWN at 111.84 yen from 111.86 yen

Oil – Brent Crude: DOWN six cents at $74.45 per barrel

Oil – West Texas Intermediate: DOWN 21 cents at $66.09

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Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.