Global Markets Slump Amid Mixed Stimulus Reactions

Global stocks slipped on Wednesday, with China showing some positive momentum despite mixed reactions to its broad stimulus plan. European stocks declined, oil prices fell, and the dollar weakened. U.S. consumer confidence dropped, increasing chances of another interest rate cut by the Federal Reserve. Chinese stocks showed gains, but regional markets remained cautious.

Global markets experienced a downturn on Wednesday, with China being a rare bright spot amid a continued stimulus-fueled rally. The dollar faced pressure while crude oil prices receded from recent highs. European stocks fell by 0.1%, after nearly 1% gains the previous day, primarily due to declining oil and gas shares amid concerns over China's stimulus effectiveness.

Wall Street was bracing for losses as S&P 500 futures slid by 0.2%. The dollar dipped to a one-month low against the euro and a two-and-a-half year low versus the British pound. U.S. consumer confidence data, reflecting the largest drop in sentiment since August 2021, strengthened the argument for a significant interest rate cut at the Federal Reserve's upcoming meeting.

The People's Bank of China followed Tuesday's wide-ranging policy easing announcement by cutting medium-term lending rates on Wednesday. This broad-stroke stimulus aims to boost the stock market and support the property sector. Despite strong gains in Chinese stocks, analysts argue more is needed to tackle weak consumer demand. Meanwhile, the dollar continued to weaken in response to China's actions, with other currencies making modest gains.

(With inputs from agencies.)