LONDON: A stock market rally waned Thursday, with eurozone shares treading water as the European Union warned of slowing growth across the single currency bloc.
London outperformed on hopes that a Brexit deal would soon be announced, dealers said.
Wall Street was steady in the late New York morning as the excitement of the US mid-term elections faded.
"The post-election bounce was strong (for stocks) but short-lived," said Craig Erlam, senior market analyst at Oanda trading group.
The dollar managed a modest recovery after Wednesday's selloff in the wake of the US elections.
The vote outcome clouds the outlook for the pace of rate rises by the US Federal Reserve, dealers said, adding that there was little chance of any change at Thursday's Fed monetary policy meeting.
- EU growth 'disappointment'-
The midterm results -- which saw the Democrats regain control of the House of Representatives and President Donald Trump's Republican party widening its majority in the Senate -- could mean less pressure on the Federal Reserve to raise US interest rates more aggressively, taking some heat out of the dollar, according to analysts.
Trump now faces a tough two years before his 2020 re-election bid, with Democrats appearing ready to fight against his tax-cutting, deregulation agenda while boosting oversight of the president's administration.
In Europe meanwhile, the EU on Thursday said growth in the eurozone would slow in 2019 and beyond, citing global uncertainty and heightened trade tensions.
The European Commission warned also that Italy's deficit would balloon in 2019 owing to a spending boost planned by Rome's populist government that blatantly defies the EU over bloc rules on expenditure.
Analysts at Capital Economics called the eurozone's growth slowdown "a major disappointment", although they said growth could pick up again over coming quarters.
Elsewhere, oil prices were subdued after data showing a surge in US energy stockpiles, although there was some support from reports OPEC may reduce output next year.
The cartel had started opening the taps again this year after a long-running cap agreement with Russia, which boosted prices, ended.
But with production now rising globally again -- and Iran sanctions seemingly having little impact owing to US waivers -- Bloomberg News said ministers meeting in Abu Dhabi this weekend were considering a reduction.
"Saudi Arabia and Russia have increased production, and prices have come down $15 a barrel," Hossein Kazempour Ardebili, Iran's representative to the OPEC, said. "They have over-balanced the market" and have no choice but to cut about one million barrels a day.
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