European, US stocks tumble but dollar gains

New York - Equities fell on Wednesday as sagging financial stocks dragged major indices lower in New York, while European markets headed south after recent volatile swings.

The blue-chip Dow Jones Industrial Average broke a seven-day winning streak, falling 0.3%, and the broader S&P 500 lost 0.2%, as investors rotated out of Wall Street banks.

Rising technology stocks lifted the Nasdaq, however, which posted a strong 0.4% gain.

The trading day followed the release of disappointing economic data showing US wholesale inflation and industrial production both flat.

Michael James of Wedbush Securities told AFP the Dow was dragged lower as investors rotated out of some of the stocks that comprise the index.

"The bank index is down nearly one and a half percent," he said. "At the same time you are seeing some rotation back into some of the technology stocks that have been hit as hard as they were."

Apple gained 2.7%, Microsoft rose 1.3% and Google parent Alphabet edged 0.6% higher.

Red arrows also pointed downward on the other side of the Atlantic. Paris, Frankfurt and London all dropped, a day after marching higher on rising oil prices which also fell on Wednesday.

CMC Markets analyst Jasper Lawler noted that Donald Trump's approaching presidency after his shock win last week was "still front and centre" for markets.

London's benchmark FTSE 100 was pulled lower by the construction and real estate sectors over concerns about Britain's decision to exit the EU, analysts said.

Looking to the Fed

Investors also digested official data showing that Britain's jobless rate dipped to an 11-year low of 4.8% in the three months to September.

Analysts said the dollar hit a 13-year high against a basket of currencies early in the day, as confidence grew that the US Federal Reserve would hike interest rates next month.

Late in the day in New York it hit its highest level against the euro since December 2015.

"Even before the election, the greenback's fundamental picture was brightening, helped by the US economy's strongest growth in two years last quarter when it grew nearly 3%," senior market analyst Joe Manimbo of Western Union Business Solutions said in a note to clients.

"Quicker growth was supportive of the Federal Reserve raising rates this year."

Trump's victory continues to fan uncertainty over the global economic outlook, which also remains clouded by Brexit.

Energy firms had led a rally in many Asian markets after oil prices soared on hopes for a deal by producers to cut output at the end of the month.

But prices fell in late European trading after figures showing a rise in weekly US stocks and as concerns crept in about whether the Organisation of the Petroleum Exporting Countries will hammer out an accord to tackle a stubborn supply glut that has depressed prices since 2014.