Wall Street opened lower after shares in Europe and Asia fell on fears that the central bank would end easy monetary policy to curb inflation. US oil prices fell nearly five per cent to 62 36.231 a barrel on the back of an increase in US data stockpiles, and demand in virus-infected Asia is on the rise. Meanwhile, Bitcoin signaled a new crackdown on cryptocurrency by China after a 30 percent increase, and tycoon Elon Musk sent mixed signals about the use of his car company's unit.
Before recovering slightly - the bitcoin fell to almost 30,000, less than half of last month's record level.
China said digital currencies could not be used in markets because they were not real, adding that firms could not use units to price their goods or services.
"This is the latest chapter in China that tackles the itch around crypto," said Anthony Trinishev, managing partner and co-founder of Nexo, a London-based crypto lender.
Musk suggested that Tesla was planning to sell a large stock of its bitcoin when the electric car giant said it would stop using it in transactions due to environmental concerns.
Musk later said that Tesla had not sold any of its bitcoins.
Mining cryptocurrency is a highly energy-intensive process that requires large amounts of electricity in data centers. London amenities, meanwhile, fell 1.3 per cent in April, following the rise in official UK inflation figures in April.
Frankfurt dipped 1.7 percent, and Paris fell 1.4 percent, while the Dow closed 1.1 percent lower in morning trade.
On Tuesday, "after a sell-off on Wall Street," European markets traded sharply lower on Wednesday, "OANDA analyst Sophie Griffiths noted.
"Inflation fears continue to plague markets," he warned.
The UK government consumer price index fell to 1.5% in April, the highest since the outbreak of the Cove 19 epidemic in March 2020.
The data came as a shock to global inflation, when the economy reopened and a week later it was reported that US inflation had risen to 4.2% in April.
Meanwhile, eurozone data on Wednesday confirmed that inflation in the bloc had risen to 1.6 percent in the past month.
Asian equities also declined as investors struggled to break a long period of volatility, hoping for an economic recovery amid fears of rising prices.
The focus has shifted to the impact that the expected breakdown in economic activity this year will have on inflation, prompting many to warn that they could force banks to raise interest rates.
Iceland's central bank raised its key rate on Wednesday, citing inflation concerns.
Traderss will read closely the minutes of the Federal Reserve's April meeting, when they will be released at the end of Wednesday, and expect the board's views on its response to prices.
Keyy personalities around 1515 GMT -
London FTSE 100: Down 1.2% at 6,949.18
points
Frankfurt DAX 30: 1.7% down to 15,131.04
Paris CAC40:
Down 1.4% to 6,267.86
Eurostocks 50: down 1.5% at 3,944.05
New York Dow: Down 1.1 percent to 33,691.48
Tokyoo Nikkei 225: Down 1.3% to 28,044.45 (close)
Shanghai - Composite: down 0.5% to 3,510.96 (close)
Hong Kong Hang Seng Index:
Closed for the holidays
EUR / USD: Down from 1. 1.2222 to 22 1.2218 on Tuesday at 2115 GMT
Pound / Dollar: OW down from 4 1.4189 to 4 1.4158
Euro / Pound: UP at 86.14p to 86.30p
Dollar / Yen: Down from 108.90 Yen to 108.70 Yen
Brent North Sea crude: down 3.90% per barrel.06.03
West Texas Intermediate: 4.34% at. 62.65 per barrel
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