European stocks fell across the board Thursday as traders regrouped from yesterday's oil market volatility and re-set expectations for growth and inflation after the first agreed OPEC production cut in eight years.
Britain's FTSE 100 fell around 0.5% by 09:45 GMT, despite solid gains for mining and energy stocks, while the DAX performance index in Germany slipped 0.65% lower and France's CAC-40 dropped 0.6% from Wednesday's close.
Glencore plc (GLNCY) the world's biggest mining company, said Thursday that it would begin returning cash to shareholders next year after better-than-expected results from an asset sale and debt reduction plan.
Glencore shares rose 0.5% in London trading to change hands at 280 pence each, extending the three month advance to around 60%, double the gains of the FTSE 350 mining index.
Oil prices extended gains overnight in Asia trading after OPEC members agreed to cut production by 1.2 million barrels per day from January 1. The six-month agreement, the first the 14-member cartel has brokered since 2008, pushed global prices up more than 9% in a volatile session Wednesday that extended into Asia trading.
West Texas Intermediate crude for January delivery added a further 0.8% by 09:45 GMT to trade at $49.36, after the contract price topped $50 for the first time since October earlier in the session. Brent crude, the global benchmark, added 0.91% to change hands at $51.87.
Higher oil prices also had an immediate impact on global inflation expectations, taking both bond yields and the value of major currencies higher in its wake. Benchmark 10-year U.S. Treasury bond yields rose 2 basis points to 2.38% in Asia trade, while 30-year bonds traded at 3.02%.
Stocks in Asia recorded the strongest daily gains in three weeks overnight, with Japans's Nikkei 225 hitting its highest close of the year, as energy stocks boosted benchmarks around the region and the strong dollar helped export-led stock markets extend advances.
The Nikkei closed at 18,513.12, up 10.12% on the session and its highest session-ending level of 2016, helped in part by a 12% surge for Japan Petroleum Exploration Co, its biggest advance in more than three years.
The dollar index, a measure of the greenback against a basket of six global currencies, traded as high as 101.38 before paring gains to 101.27 by 08:15 GMT. The pound traded 0.35% higher early in the European session at 1.2549 while the euro gained around 0.3% against the dollar to trade at 1.0616.
The Dow Jones Industrial Average led U.S. markets Wednesday as the global crude rally lifted the energy sector, helping the benchmark add 0.12% on the session. The S&P 500, however, slipped 0.14% after reaching an intra-day record during the session and the Nasdaq fell 1%.
Early indications from U.S. futures prices see the Dow falling 1.2 points at the opening bell on Wall Street, the S&P 500 falling around 2 points and the Nasdaq 7.1 points.