As investors warily awaited the Federal Reserve's interest rate announcement, European stock markets initially posted gains but later reversed their gains.
By the end of the day, the FTSE 100 in London was down 0.5%, the CAC in Paris was down 0.7%, and the DAX in Germany was down 0.6%.
Stocks were also hit throughout the afternoon by news that factory production in the eurozone declined in October to its lowest level since the start of lockdowns in 2020.
All of the main economies in the union, with the exception of Ireland, saw the downturn worsen, according to S&P Global's PMI survey. The worst affected country was Spain, closely followed by Germany.
However, when GSK (GSK.L) upped its projection for the whole year due to robust demand for its shingles vaccine and future medicine releases, pharmaceutical companies surged on London's benchmark index.
With an increase in underlying earnings of between 15% and 17%, it now anticipates annual sales growth of between 8% and 10%.
In the UK, however, the price of fresh food rose at the quickest rate ever in the past month, 13.3%. Since the British Retail Consortium (BRC) began compiling the monthly data in 2005, this was the sharpest increase.
Overall, food costs increased by a record 11.6%, with store cupboard essentials like canned food and other less perishable consumables seeing a 9.4% increase.
According to the BRC, the rises are a result of a tight labor market and an increase in retailers' energy costs.
On Wednesday, Wall Street equities also experienced losses as the dollar dropped as investors awaited the Federal Reserve's policy decision later in the day.
By the time of the European close, the tech-heavy Nasdaq (IXIC) had down 1.3% and the S&P 500 (GSPC) had fallen 0.7%. The Dow Jones (DJI) decreased by 0.4%.
The Federal Reserve is anticipated to increase its benchmark rate by an additional 0.75%, bringing it to 4%.
The market is still hoping for cautious language on slowing the pace of hikes, said to Neil Wilson of Markets.com.
Powell stated in his statements at the previous two news conferences that "at some point, as the stance of monetary policy tightens further, it will become essential to reduce the pace of increases as we analyze how our cumulative policy adjustments are influencing the economy and inflation." Any modification to this, maybe indicating that this moment is near, might be viewed as a pivot.
Meanwhile, a rise in hiring at bars and restaurants, merchants, and travel agencies helped US businesses add more jobs than anticipated last month.
ADP, a company that handles payroll, reports that the private sector added 239,000 jobs in October, far more than the 195,000 analysts had predicted.
The latest job openings data and ISM manufacturing report showed that the American economy remained in decent form, despite concerns about an economic downturn, but US markets lost some of their early momentum on Tuesday, ending the session lower.
The Nikkei (N225) lagged behind its rivals, ending just 0.1% lower on the day in Japan, while the Hang Seng (HSI) surged 2.4% in Hong Kong and the Shanghai Composite (000001.SS) rose 1.1% following initially cautious trading on Wednesday.
As Beijing continues to battle a coronavirus outbreak, Chinese officials have ordered an extended lockdown of a crucial iPhone production plant.
A seven-day lockdown at the Zhengzhou facility has stopped employees from leaving, which is likely to cause more employee unrest.
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