Global stocks rally loses steam

New York - The rally in global stocks lost steam on Wednesday as major indices turned in a mixed performance ahead of a keenly anticipated Bank of England monetary policy meeting.

In the US, the Dow and S&P 500 edged to records again, the latter for the third straight day, but the tech-rich Nasdaq finished lower.

Equity markets dipped in London and Frankfurt, while Paris and Tokyo rose.

The muted performance was in stark contrast to the last three days, when global equity markets shrugged off worries about Britain's vote to leave the European Union and pushed decisively higher.

"The market needs a bit of a breather after an amazing run," said Alan Skrainka, chief investment officer of Cornerstone Wealth Management.

Britain remained in focus with the Bank of England set to meet on Thursday for the first time since the monumental June 23 vote to exit the EU. Governor Mark Carney has signalled more stimulus is likely in the near term.

While markets are pricing in an interest rate cut as early as this week, some analysts believe a drop in the BoE's main lending rate from 0.50% to a new record low of 0.25% or even zero may not now occur until August.

Some analysts said the time-frame could slide in light of Theresa May's quick appointment as prime minister, which has reduced some of the uncertainty in the country.

Germany issued a 10-year bond at a negative interest rate for the first time as fears about Brexit and economic worries cause investors to rush to the safety of German debt.

A Federal Reserve report described the US economy as still modestly growing with signs of a slowdown in consumer spending. Most of the Fed's 12 districts reported a slowdown in auto sales that still remained at "fairly high levels", the Beige Book report said.

Oil prices fell sharply after the US reported a smaller than expected decline in crude stockpiles and a surprise build in product inventories, adding to worries about abundant global supplies.

Petroleum-linked stocks retreated: Total lost 1.0%, Royal Dutch Shell 0.6% and US midsized company Devon Energy 2.5%.

Big gainers in Japan included Toyota and Mitsubishi UFJ Financial Group, which jumped a respective 3.4% and 5.3%.

Nintendo eased 4.4% as investors booked profits after the videogame giant surged nearly 60% since last Thursday on the back of huge demand for its new smartphone game Pokemon GO.