The Albany Gazette - European equities slip on Ukraine fears, US markets slump

London slid 0.3 percent, weighed down by news UK inflation spiked to a 41-year peak in October amid rocketing energy bills and food prices.

Frankfurt fell 1.0 percent and Paris stocks sank 0.5 percent after Asia closed mostly in the red.

US stocks closed lower as well, with the broad-based S&P 500 shedding 0.8 percent.

The dollar rose against the yen, but slid against the euro and pound.

"Reports of missile strikes in Poland on Tuesday naturally caused a shudder in the markets," said Craig Erlam, senior market analyst at trading platform OANDA.

"The prospect of a sudden and unexpected escalation in the war in Ukraine, particularly involving a NATO state, doesn't bear thinking about but we were almost forced to," he added.

Two people were killed on Tuesday when at least one missile hit a village in NATO member Poland near the Ukrainian border during a mass Russian bombardment.

While there were fears the incident could mark a fresh conflict escalation, Poland has since announced that the projectile likely originated from Ukraine's own air defenses -- a theory endorsed by Washington and helping to calm market jitters.

- 'Reeling' -

In Britain, official data showed UK inflation surged in October to 11.1 percent, the highest level since 1981 in a worsening cost-of-living crisis.

The grim news came on the eve of a gloomy UK government budget likely to ramp up taxes and slash spending.

"The UK is reeling from yet another super-hot inflation reading as soaring food and energy prices take their toll on household budgets," said Hargreaves Lansdown analyst Susannah Streeter.

Russia's invasion of Ukraine this year has sent food and energy prices soaring worldwide, adding to earlier pandemic-fueled supply constraints.

Rocketing consumer prices has forced central banks to hike interest rates steeply, risking a global recession.

Given some relief from recent data indicating US inflation was easing and the economy slowing, Federal Reserve Governor Christopher Waller said he was "comfortable" considering a less aggressive pace of interest rate hikes, although more increases are still needed.

US data showed retail sales jumped more than expected in October, pointing to resilience in consumer spending, but major chain Target reported weaker-than-expected results, warning of a weak holiday shopping season.

Target CEO Brian Cornell said "sales and profit trends softened meaningfully, with guests' shopping behavior increasingly impacted by inflation, rising interest rates and economic uncertainty."

Target shares tumbled 13.1 percent.

- Key figures around 2145 GMT -

New York - Dow: DOWN 0.1 percent at 33,553.83 points (close)

New York - S&P 500: DOWN 0.8 percent at 3,958.79 (close)

New York - Nasdaq: DOWN 1.5 percent at 11,183.66 (close)

EURO STOXX 50: DOWN 0.8 percent at 3,882.78 (close)

London - FTSE 100: DOWN 0.3 percent at 7,351.19 (close)

Frankfurt - DAX: DOWN 1.0 percent at 14,234.03 (close)

Paris - CAC 40: DOWN 0.5 percent at 6,607.22 (close)

Tokyo - Nikkei 225: UP 0.1 percent at 28,028.30 (close)

Hong Kong - Hang Seng Index: DOWN 0.5 percent at 18,256.48 (close)

Shanghai - Composite: DOWN 0.5 percent at 3,119.98 (close)

Euro/dollar: UP at $1.0395 from $1.0354 on Tuesday

Pound/dollar: UP at $1.1914 from $1.1871

Dollar/yen: UP at 139.54 yen from 139.16 yen

Euro/pound: UP at 87.21 pence from 87.18 pence

Brent North Sea crude: DOWN 1.1 percent at $92.86 per barrel

West Texas Intermediate: DOWN 1.5 percent at $85.59 per barrel

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(F.Schuster--BBZ)