US markets

U.S. stocks slipped Wednesday, as investors balanced a pair of positive blue chip earnings reports against concerns that the market may be set for a breather after seven straight days of gains. The Dow Jones Industrial Average slipped 22 points, or 0.2%, to 12210, in afternoon trading, even as two of its component stocks climbed on the back of positive earnings surprises. Walt Disney surged 5.3% after the company reported late Tuesday that stronger advertising revenues for television and buoyant home video sales of "Toy Story 3" boosted its first-quarter profit.

[Get this delivered to your inbox for FREE. Subscribe to our daily Markets Newsletter.]

Coca-Cola rose 0.7% after the soft drink maker said fourth-quarter profit more than tripled on benefits related to the acquisition of its biggest bottler's North American operations, as well as improved demand abroad. However, weighing on the DJIA, J.P. Morgan Chase fell 1.6% after one of the bank's executives apologized for overcharging 4,500 active-duty military members for mortgages and wrongly foreclosing on 18.

The Standard & Poor's 500-stock index shed 0.4% to 1319, while the Nasdaq Composite fell 0.3% to 2789. Investors were generally cautious after Asian markets fell broadly overnight, as investors there got their first chance to react to the interest-rate hike in China that came late Tuesday for those markets. With no economic data on the U.S. calendar, investors were also watching comments from Federal Reserve Chairman Ben Bernanke, who reiterated his concerns about the strength of the economy while playing down inflation concerns.

European markets

European stocks fell Wednesday as disappointing news from drug giant Sanofi-Aventis and car maker PSA Peugeot Citroen outweighed gains for the utility sector. The Stoxx Europe 600 Index fell 0.4% to 287.35. Disappointing trading updates helped provide that excuse. The French CAC 40 index slipped 0.4% to 4,090.74. One of the top decliners in the CAC was Peugeot, whose shares dropped 4.5% after the car maker reported a return to profit, but said the European market will remain challenging in 2011.

Rival Renault SA fell 1.7%. Shares of Sanofi-Aventis slipped 1.6% after the drug maker reported a sharp drop in fourth quarter earnings due to restructuring charges. It said profit for 2011 is likely to drop between 5% and 10%. The U.K.'s FTSE 100 fell 0.6% to end at 6,052.29. Household products firm Reckitt Benckiser Group PLC weighed on the U.K. index, falling 5.1% after warning that global market growth is slowing.

Among mining shares, BHP Billiton PLC fell 2.1% and Vedanta Resources PLC dropped 3% amid worries of further policy tightening in China after Beijing raised interest rates Tuesday. Shares of London Stock Exchange Group PLC gained 3.1% after the exchange operator agreed an all-stock merger with Canada's TMX Group Inc. Meanwhile, shares of Deutsche Boerse AG were suspended in afternoon Frankfurt trading.

Deutsche Boerse and NYSE Euronext confirmed that they are engaged in advanced merger discussions. Germany's DAX 30 index was nearly unchanged, ending down 0.03% at 7,320.90, as retailer Metro AG rose nearly 4%. Shares of Linde AG advanced 2% after the firm was upgraded to buy from hold at Societe Generale.

Asian markets

Asian equity markets ended mostly lower Wednesday, as China's move to raise interest rates late Tuesday weighed. Japan's Nikkei Stock Average shed 0.2%, South Korea's Kospi lost 1.2%, China's Shanghai Composite shed 0.9% after choppy trade and Hong Kong's Hang Seng Index fell 1.4%. The People's Bank of China said Tuesday that it would raise its benchmark lending and deposit rates by 0.25 percentage point, effective Wednesday. Analysts said rapid loan growth and surging consumer prices in January were behind the move. They widely expect inflation topped 5% last month. China is due to issue January's consumer price index data around Feb. 15. China property stocks were lower on concerns more expensive mortgages will hurt property demand. On the mainland, China Vanke dropped 2.0% and Gemdale fell 3.3%, while in Hong Kong, China Overseas Land dropped 2.1% and China Resources Land ended 3.9% lower. Singapore listed Yanlord Land dropped 2.0%. In Tokyo, Chinese demand sensitive Komatsu and Hitachi Construction Machinery each lost 1.7%. Toyota Motor jumped 5.2% its biggest percentage gain since December 2009 after the automaker raised its net profit projection for the fiscal year through March by 40% to Y490 billion.

Base metals

Base metals closed mostly lower on the London Metal Exchange Wednesday after slumping in late European trade as stock markets slipped and investors took profits. LME three month copper, which hit a record of $10,160 a metric ton Feb. 7, closed down 1.3% at $9,925/ton. LME lead slumped further amid heavy selling, to end the kerb down 2.1% at $2,515/ton.

Oil

Oil futures fell Wednesday after the government reported an unexpected increase in U.S. fuel supplies. Light, sweet crude for March delivery settled 23 cents lower at $86.71 a barrel on the New York Mercantile Exchange after earlier trading as high as $87.95 a barrel. Supplies of gasoline in the U.S. rose 4.7 million barrels last week to their highest level since 1990, the U.S. Department of Energy reported Wednesday. Stocks of distillates, including heating oil and diesel, rose 300,000 barrels, while crude stockpiles increased 1.9 million barrels. Comex gold futures ended nearly unchanged after comments from Federal Reserve Chairman Ben Bernanke reinforced the bank's commitment to current policy. The thinly traded February delivery contract settled up $1.40, or 0.1%, at $1,364.80 a troy ounce on the Comex division of the New York Mercantile Exchange. The most actively traded contract, for April delivery, was up $1.40, or 0.15, at $1,365.50 a troy ounce.
[Get this delivered to your inbox for FREE. Subscribe to our daily Markets Newsletter.]