European stocks ease as investors rejig portfolios

London, Oct 1 (AFP) European stocks slipped Tuesday as investment managers recalibrated portfolios at the start of the final quarter of the year, but the downside was limited by mild optimism on trade and central bank action, analysts said. While equities started on the "backfoot", said Fawad Razaqzada at Forex.com, "the stock market bulls are happy to keep buying every dip - for now, anyway".

Wall Street managed some modest gains at the opening, encouraged by resuming US-China trade talks this month. "Traders are seemingly a little more relaxed about the current situation, with the Fed having cut interest rates at each of the last two meetings and talks between the US and China ongoing," said Craig Erlam, senior analyst at Oanda.

"I don't think traders are fully satisfied in either case but minimum expectations are just about being met," he said. Earlier, Asian stocks performed well, while oil rebounded after Monday's heavy losses.

Investors are now looking to a US jobs report on Friday for clues to the state of the world's top economy. They are also eagerly awaiting next week's resumption of trade talks between Beijing and Washington, said Quincy Krosby, chief market strategist of Prudential Financial.

The latest discussions set for October 10 are "clearly a positive for the markets because the effect it has on the world economy is paramount going into the last quarter", Krosby said. Meanwhile, the World Trade Organization on Tuesday cut its 2019 trade growth forecast to 1.2 per cent, a sharp downgrade on the 2.6-per cent rise predicted in April, which the body blamed on trade tensions.

"The darkening outlook for trade is discouraging but not unexpected," WTO director general Roberto Azevedo said in a statement. Sydney's stock market closed up 0.8 percent and the Australian dollar dipped after the Reserve Bank of Australia cut interest rates to a new low.

Elsewhere, oil prices recovered after falling almost four percent on Monday. (AFP) SCY SCY

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