By Nathan Allen
Global stocks paused on Wednesday after disappointing sales data from U.S. retailers on Tuesday and as trade tensions between the U.S. and China continued to overhang market activity.
The Stoxx Europe 600 was nearly unchanged in early trade, with the U.K's FTSE 100 up 0.4% and Germany's DAX flat at the open.
Asian indexes were mixed, with the Hong Kong Hang Seng and Korea's Kospi both trading 0.2% higher while China's Shanghai Stock Exchange dropped 0.6%.
London-listed retailer Marks & Spencer Group was the biggest loser on the FTSE 100, falling 5% after launching a heavily discounted rights issue to finance its joint venture with Ocado Group. It was the latest disappointment from the retail sector, after U.S. retailers reported slower sales during the latest quarter as they brace for higher tariffs on Chinese imports.
On Wall Street, futures pointed to opening losses of 0.1% for the S&P 500 and the Dow Jones Industrial Average, and 0.3% for the Nasdaq-100. U.S. indexes closed higher Tuesday, lifted by technology stocks after the White House granted temporary exemptions to an export blacklist against Huawei Technologies.
Meanwhile, U.K. Prime Minister Theresa May on Tuesday made a fourth push to gain parliamentary support for her Brexit deal, proposing several concessions, including a second referendum on Britain leaving the EU.
The British pound rallied immediately after her comments but quickly returned to lower levels. Before her address the pound had hit a four-month low against the dollar as fears of a so-called hard Brexit returned.
Traders have been struggling to gauge the underlying direction of markets, which have become increasingly volatile as tensions between the U.S. and China have flared up in recent weeks.
"The longer the paralysis lasts the more extreme the swings are going to be," Philippe Gijsels, chief strategy officer at BNP Paribas Fortis said.
Investors will be watching for any policy signals from European Central Bank President Mario Draghi, who is scheduled to speak in Frankfurt this morning. U.K. inflation numbers are also due later in the day.
The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, was up 0.1%.
The yield on 10-year U.S. Treasurys edged down to 2.420% from 2.428% on Tuesday. Yields move inversely to prices. German 10-year government bonds were in negative territory at -0.077%.
In commodities, global benchmark Brent crude oil was down 0.7% at $71.71 a barrel.
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