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Trump-fuelled stocks rally slows

London - A strong run for world equities since Donald Trump's election slowed on Wednesday as Wall Street consolidated record highs and European markets eked out small closing gains.

Many investors stayed on the side-lines ahead of the publication later on Wednesday of minutes of the last Federal Reserve meeting which they hope will give fresh insights into the timing of the next rate hike.

"Domestic stocks are resting at all-time highs, and European equities are mixed, with the global markets assessing political risks on both sides of the Atlantic and awaiting the afternoon release of the minutes from the Fed's recent meeting," analysts at US brokerage Charles Schwab analysts said in a note to investors.
French politics

French political news in the run-up to presidential elections in April and May lifted domestic markets late in the session as Emmanuel Macron, an independent candidate, won the support of Francois Bayrou, a veteran centrist.

The Macron/Bayrou ticket was credited with a good chance of keeping far right candidate Marine Le Pen, whose anti-EU stance has spooked investors, out of power.

French bond prices spiked in response and the Paris stock market index also reversed early weakness to close slightly higher.

The euro, which has suffered from political uncertainty in Europe, also came back from early weakness to trade higher against the dollar.

The Dax 30 index in Frankfurt managed small gains, closing just shy of the key 12 000 level which it breached early in the session for the first time since the spring of 2015.

Investors cheered the sale by ThyssenKrupp of its loss-making Brazilian steel mill, sending the heavy industry giant's share price more than four percent higher.

But they were doubtful on Bayer even as the company said its Monsanto takeover was on track, selling the stock.

"Gains from engineer Thyssenkrupp's Brazilian asset sale are offsetting questions about Bayer's growth following the big Monsanto acquisition," said Mike van Dulken, head of research at Accendo markets.

Also, German business confidence unexpectedly bounced back in February, a key survey showed Wednesday, even as political uncertainty continues to cloud the prospects for Europe's biggest economy.

The Ifo institute's headline index climbed to 111 points, the same level it reached in December, after slipping to 109.9 points in January.

Weak pound helps London

London hung on to positive territory by a thread, helped by a recovering financial sector as Lloyds posted strong results, pushing the bank's stock over four percent higher.

Renewed optimism for banks also helped HSBC shares claw back two percent after their spectacular Tuesday drop on worse-than-expected results.

The rest of the FTSE 100 index was helped by sterling heading lower in reaction to mixed UK growth data ahead of Brexit, analysts said.

Sterling's weakness since last year's Brexit vote has been a boon for British exporters, boosting their earnings in other currencies than the pound.

Earlier, Hong Kong had led most Asia markets higher, but Tokyo struggled as a stronger yen weighed on exporters' share prices.

Shares in Toshiba soared more than 22% on expectations of a part sale for its microchip business, and after the Japanese giant sold its medical finance unit to Canon.

Back in Europe, shares in Airbus fell after the aircraft maker said its profits nosedived last year as charges related to problems with its A400M military cargo transport plane sent earnings into a tailspin.

Oil slumped, with investors struggling to make up their minds whether Opec production cuts and US production increases add up to an overall positive or negative picture for prices.

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