Stocks in Europe and Asia moved lower Friday despite a record finish on Wall Street as recent declines in oil prices pressured shares of energy companies.
The Stoxx Europe 600 was down 0.5% in morning trading, led lower by a fall in the oil and gas sector. Brent crude shed $2.50 on Thursday, accelerating declines after European and Asian markets closed amid disappointment that OPEC didn't take more aggressive measures to cut production at a meeting in Vienna.
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Although the Organization of the Petroleum Exporting Countries agreed to extend production cuts through March 2018, "the market had been speculating in deeper cuts and a longer commitment," said Martin Enlund, analyst at Nordea.
Brent crude oil was up 0.2% at $51.57 a barrel midmorning Friday, but remained on track to end the week 3.8% lower. Energy companies account for roughly 6% of the S&P 500 and the Stoxx Europe 600, according to FactSet.
Bank shares also fell across Europe as government bond yields declined, with shares of Banco Santander off 1.7%, Deutsche Bank off 2.3% and Lloyds Banking Group off 1.6%.
Futures pointed to a 0.1% opening decline for the S&P 500, which on Thursday notched its 19th record closing high of the year, surpassing the 18 records reached in 2016.
The S&P 500, Dow Jones Industrial Average and Nasdaq Composite have risen for six straight sessions, supported by stronger-than-expected first-quarter earnings, expectations for the Fed to move only gradually and continued signs of a steady economy.
"Better growth and inflation is translating into better revenues: this kind of environment is good for stocks and bad for bonds," said Jeff Knight, global head of investment solutions at Columbia Threadneedle Investments, which manages $467 billion in assets.
While the market is looking expensive and there may be better opportunities overseas, low volatility and high investor confidence suggest there might be a bit further for the market to climb, he said. "We think we're heading toward a period of time when it might be wise to de-risk, but we're not there yet."
In currencies, the British pound fell 0.5% against the dollar to $1.2879. Jordan Rochester, currency strategist at Nomura, said the move came as a poll showed a narrowing lead for the Conservative Party in June elections.
The pound is likely to continue to be under pressure if polling continues to indicate it's a tighter race, he said. "For the market the worst outcome is if we have further uncertainty with the chances of a hung parliament."
The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, edged down 0.2%.
Earlier, Australian and Japanese stocks lagged behind other Asian equities on Friday, amid pressure from oil's recent pullback and losses in iron-ore and steel prices.
Australia's S&P/ASX 200 shed 0.7% amid broad weakness in commodities-focused companies, while Japan's Nikkei was off 0.6% as a stronger yen also weighed on Japanese stocks.
The dollar was last down 0.7% against the yen, as data showed Japan's core consumer prices rose 0.3% from a year earlier.
South Korea's Kospi Composite Index climbed 0.5% to a new record as index heavyweight Samsung advanced, while India's Sensex rose 0.9% to a record high.
Write to Riva Gold at firstname.lastname@example.org and Lucy Craymer at Lucy.Craymer@wsj.com
(END) Dow Jones Newswires
May 26, 2017 05:31 ET (09:31 GMT)