Eurozone stocks pushed higher Thursday after the European Central Bank (ECB) only tweaked its pandemic stimulus measures and insisted surging prices are only temporary, while US shares retreated again.
ECB policymakers kept the pandemic emergency bond-purchasing program (PEPP) unchanged at 1.85 trillion euros, retaining its main tool to cushion the impact of the coronavirus crisis and keep credit cheap in the eurozone.
But as economic activity has bounced back, the ECB's policy council trimmed the amount of monthly purchases, which it had raised when the eurozone recovery appeared to have stalled.
ECB chief Christine Lagarde said the move is not a "tapering" or winding down of stimulus support, but a "recalibration."
ThinkMarkets analyst Fawad Razaqzada said the announcement "means that the difference is only going to be marginal."
Frankfurt added less than 0.1 percent and Paris gained 0.2 percent.
Lagarde also reiterated that the ECB sees the rise in inflation to a decade-high as just temporary, even as the bank confirmed price hikes would shoot past the bank's two-percent target this year.
Investors have been preoccupied that surging inflation could push the ECB and US Federal Reserve to begin removing pandemic support and eventually raise interest rates.
While disappointing US job creation figures last month have likely put off the start of the Fed's tapering of its stimulus measures for a couple of months, analysts still widely expect it to begin by the end of the year.
Meanwhile, US first-time unemployment claims last week fell to 310,000, another pandemic-era low, confounding analyst expectations for a modest increase.
"The key takeaway from the report is that the overall trend is moving in the right direction, albeit at a slow pace," said market analyst Patrick O'Hare at Briefing.com.
Wall Street stocks retreated for a second day as traders weighed better employment data against uncertainty over US monetary policy and President Joe Biden's infrastructure package.
"The market is really, really extended, and I think it's exhausted," said Tom Cahill, portfolio strategist at Ventura Wealth Management.
Among individual shares, Moderna surged 7.8 percent after announcing it is developing a vaccine that would combine a booster shot for Covid-19 with a seasonal flu inoculation.
- Key figures around 2100 GMT -
New York - Dow: DOWN 0.4 percent to 34,879.38 (close)
New York - S&P 500: DOWN 0.2 percent to 4,493.28 (close)
New York - Nasdaq: DOWN 0.3 percent to 15,248.25 (close)
EURO STOXX 50: FLAT at 4,177.11 (close)
London - FTSE 100: DOWN 1.0 percent at 7,022.62 (close)
Frankfurt - DAX 30: UP less than 0.1 percent at 15,623.15 (close)
Paris - CAC 40: UP 0.2 percent at 6,684.72 (close)
Tokyo - Nikkei 225: DOWN 0.6 percent at 30,008.19 (close)
Hong Kong - Hang Seng Index: DOWN 2.3 percent at 25,716.00 (close)
Shanghai - Composite: UP 0.5 percent at 3,693.13 (close)
Euro/dollar: UP at $1.1824 from $1.1815 at 2040 GMT
Dollar/yen: DOWN at 109.72 yen from 110.24 yen
Pound/dollar: UP at $1.3835 from $1.3773
Euro/pound: DOWN at 85.44 pence from 85.77 pence
Brent North Sea crude: DOWN 1.9 percent at $71.22 per barrel
West Texas Intermediate: DOWN 2.9 percent at $67.89 per barrel