Europe’s main stock markets wobbled in and out of positive territory, unable to match gains made across Asia, where traders welcomed indications from the Federal Reserve that US interest rates could rise next month.
London’s FTSE 100 shares index ended with a marginal gain of 0.04% at 7,517.71 points, despite sentiment being hit by a revision of Britain’s first-quarter economic growth to 0.2% from an initial estimate of 0.3%.
Trading was lacklustre in Frankfurt and Paris where many businesses were closed for a public holiday. Frankfurt’s DAX 30 was down 0.2% at 12,621.72 points, Paris’ CAC 40 dropped 0.08% at 5,337.16 points and the EURO STOXX 50 slipped 0.1% at 3,582.23 points at close.
Wall Street headed for a sixth straight day of gains, with the S&P 500 pushing further into record territory.
World oil prices briefly sank by two dollars yesterday after Opec kingpin Saudi Arabia appeared to rule out deep production cuts at a meeting of the group.
Crude futures later clawed back ground as traders awaited the conclusion of the latest gathering of the Organisation of the Petroleum Exporting Countries (Opec) in Vienna.
“Oil traders reacted to a well-telegraphed nine-month extension to the current output cuts from Opec by taking profits,” said market analyst Jasper Lawler.
Riyadh’s oil minister Khalid al-Falih said Saudi Arabia expects the likely extension of the current deal cutting output to ease the global crude glut sufficiently by early 2018.
“Comments from the Saudi oil minister that a nine-month extension is the ‘safe bet’, and that deeper cuts were not necessary, caused a near panic reaction this morning with Brent oil dropping almost $2 in the minutes that followed,” said analyst David Cheetham at brokerage XTB.
“The price has recovered somewhat since then, but the decline is an early indication as to how high expectations are at present in the market,” Cheetham continued.
“Should an extension be deemed insufficient to support the oil price, then the outlook could become quite grim (for prices) going forward,” he added.
Late last year, 24 countries — including Opec nations and Russia — agreed to cut production by 1.8mn barrels per day in order to reduce global oil inventories to the five-year average, curbing the stubborn supply glut.
This has helped oil prices surge from a low of $26 per barrel in early 2016 to around $50 now, and the producers were expected to agree a nine-month extension later yesterday.
In late afternoon deals, Brent North Sea crude for July delivery stood at $53.11, down 85 cents from Wednesday’s close.
New York’s main contract, West Texas Intermediate (WTI) crude for delivery in July, shed 65 cents to $50.71 a barrel.


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