Oil prices fell and global stock markets diverged on Tuesday, with Hong Kong suffering its worst day in 16 years as China held off announcing fresh measures to boost its聽economy.
New York鈥檚 main indexes were mostly higher shortly after opening on continued optimism about the health of the US聽economy.
European stock markets were lower in mid-afternoon trading, pulled down by the earlier slide in Asia.
Hong Kong shares slumped after China鈥檚 National Development and Reform Commission disappointed investors by not announcing any further stimulus measures.
鈥楩inancial markets are mostly in a risk-off mood on Tuesday, as China has stopped its drip feed of stimulus (and) commodity prices fall,鈥� said Kathleen Brooks, research director at XTB.
Oil prices sank almost three per cent as doubts returned about Chinese demand and as Israel comes under international pressure not to strike Iranian oil installations.聽
It was fear about Israel鈥檚 response to Iran鈥檚 missile attack last week that on Monday had sent oil prices soaring to their highest levels since August.
But president Joe Biden has urged Israel not to attack Iran鈥檚 oil facilities, fearing it could push up oil prices, in turn hitting the US聽economy聽and influencing the US election.
Global stock markets have been lifted in recent sessions as China announced a series of stimulus measures, boosting hopes of greater Chinese demand for goods including from oil, metals and luxury goods.
Share prices of companies across all three sectors slumped Tuesday, pushing Europe鈥檚 main indices into the red.
European luxury and spirits companies were also hit as Beijing announced provisional tariffs on brandy imported from the European Union, in an apparent riposte to EU duties on Chinese electric cars.
Remy Cointreau 鈥� whose brands include Louis XIII, Remy Martin and Cointreau 鈥� tumbled more than six per cent.
Pernod Ricard, which owns Martell cognac, dropped nearly four per cent.
Louis Vuitton-maker LVMH, which owns Hennessy cognac, shed more than three per cent and Gucci-owner Kering retreated over four per cent.
Burberry shares retreated 5.6 per cent in London. London was also pulled lower by energy companies.
US shares had slumped Monday after rallying the previous week, and that encouraged some 鈥楶avlovian buy-the-dip interest鈥� Tuesday morning, said Patrick O鈥橦are, an analyst at Briefing.com.
A better-than-expected jobs report last Friday showed the US聽economy聽is in strong shape, even if it watered down expectations for deep interest rate cuts in coming months.
US consumer and producer prices data towards the end of the week should provide further clues on the interest rate outlook, while third-quarter earnings season kicks off Friday.
In Asia, Shanghai closed up 4.6 per cent despite the disappointment over the lack of new stimulus measures.
Analysts cautioned that the sizeable gain reflected the index catching up with other markets following a week-long national holiday in China.
鈥楳arket hopes of even more fiscal stimulus that reaches the 鈥榖ig bang bazooka鈥� level look dashed with few details on specific measures,鈥� said Heron Lim, at Moody鈥檚 Analytics.
