NEW YORK: Global shares slipped and the dollar rose against the euro on Wednesday as investors worried about the economic health of smaller countries in the euro zone.
The euro surrendered early gains and fell as investors digested news that the European Commission backed a Greek deficit-cutting plan, as expected. The news eased some immediate investor worries over fiscal problems in the euro zone but it failed to allay long-term concerns, particularly as Greece is not seen as an isolated case in the region. European shares snapped a three-day rally on investor concerns about the euro zone’s peripheral countries, with banks falling and miners tracking metal prices lower. The FTSEurofirst 300 index of leading European shares closed down 0.6 percent at 1,020.99 points. US stocks fell after disappointing results from Pfizer and transport companies, while slower-than-expected expansion in the services sector also weighed on the market. Pfizer Inc fell 3.3 percent to $18.43, leading a broad decline in several healthcare sectors after the world’s biggest drug maker said quarterly earnings missed estimates and forecast profits below expectations.
The Dow Jones Industrial Average was down 49.05 points, or 0.48 percent, at 10,247.80. The Standard & Poor’s 500 Index was down 7.94 points, or 0.72 percent, at 1,095.38. The Nasdaq Composite Index was down 6.47 points, or 0.30 percent, at 2,183.59.
Portuguese government bonds slid as investors turned to the next perceived weak link in the euro zone after highly indebted Greece won European Commission backing for its fiscal reforms.
Greek government bonds reversed some of the gains made against German benchmarks following the commission’s endorsement of the deficit-cutting plan.
The dollar was up against a basket of major currencies, with the US Dollar Index up 0.38 percent at 79.314. The euro was down 0.32 percent at $1.3917. Against the yen, the dollar was up 0.75 percent at 91.06. Japan’s Nikkei stock average edged up 0.3 percent, while Asia Pacific stocks outside Japan as measured by MSCI rose 1.9 percent. Meanwhile, oil fell to $77 a barrel in choppy trade on Wednesday after US data showed a rise in crude inventories in the world’s largest energy consumer, while product stocks dropped.
US crude for March delivery fell 23 cents to $77 a barrel by 2:13 p.m. EST (1913 GMT).
London ICE Brent crude fell 23 cents to $75.83 a barrel.
US commercial stockpiles of crude jumped by 2.3 million barrels to 329 million barrels in the week to Jan. 29, far surpassing analysts’ forecasts for a 200,000 barrel increase, the Energy Information Administration (EIA) said.
