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.
Continue Reading Below
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 email@example.com and Lucy Craymer at Lucy.Craymer@wsj.com
(END) Dow Jones Newswires
May 26, 2017 05:31 ET (09:31 GMT)