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Global stocks: Fed-fueled equity rally fades

New York - World stocks mostly slid on Friday as investors paused for breath following a global rally fuelled by relief that US and Japanese central banks decided to maintain easy-money policies.

"The Fed-fuelled rally that catapulted shares out of the summer doldrums this week is showing some signs of fatigue," noted analyst Jasper Lawler at trading firm CMC Markets.

Sentiment was also dented by lacklustre economic data out of Europe, a sharp drop in oil prices and weakness in some of the biggest US technology companies, including Apple and Facebook.

Frankfurt and Paris each lost around half a percent in value, while the S&P 500 in the US shed slightly more at 0.6%.

The Nikkei in Japan lost 0.3%, while London held steady.

Michael James, managing director of Wedbush Securities, said the market is torn between the threat of weak third-quarter earnings and belief that the Fed's easy-money policies will propel stocks even higher.

He predicted more volatility, saying "it depends which of those views takes hold on a daily basis."

IHS Markit said its preliminary September Composite Purchasing Managers Index for the eurozone fell to 52.6 points from 52.9 points in August. That was the slowest economic growth since January 2015, although the figure remained above the 50-point level in expansion territory.

Petroleum-linked shares stumbled as oil prices slumped more than three percent following reports that Saudi Arabia is downplaying prospects of a producers deal to limit output next week in Algeria, despite the global oversupply.

Some of the biggest US tech equities also tumbled.

Apple fell 1.7% on speculation that iPhone sales have been disappointing, while Facebook lost 1.6% on concerns about its online advertising prospects after it acknowledged that it had previously counted cases of users watching for as few as three seconds.

Yahoo sank 3.1% following its disclosure on Thursday that hackers stole personal data on at least 500 million users worldwide in 2014.

An exception was Twitter, which surged 21.4% following reports it is in talks with potential buyers, including Google and Salesforce.com.

An initial public offering livened up trading in Copenhagen as shares in Danish card payment services company Nets began trading. Its shares rose by nearly three percent after the opening, but were 3.3% lower in closing trade.

The IPO valued the group at around 30bn kroner ($4.5bn).

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