Global equity markets slipped yesterday despite upbeat factory data worldwide, while the euro fell to a two-week low against the dollar on expectations that a rate cut by the European Central Bank is possible by the end of the year.

Stocks on Wall Street edged lower after data showing US manufacturing expanded briskly in October raised some worries that the US Federal Reserve may scale back its massive stimulus much sooner than expected.

US equities have been pressured since a Fed statement on Wednesday raised concerns about when the Central Bank would begin to scale back its stimulus programme, which has fueled the benchmark S&P 500 index’s 23 per cent rally this year.

The Institute for Supply Management (ISM) said its index of US factory activity rose to 56.4 last month – its best showing since April 2011 – from 56.2 in September. Economists polled by Reuters had expected a reading of 55.

The S&P and Dow Jones industrial average have hit record highs this year, including earlier in the week, but the strong gains have triggered some concerns about how much further the rally can continue, especially in light of tepid corporate revenue growth.

With almost three-fourths of S&P 500 companies reporting results so far, 68.5 per cent have beaten profit expectations, above the long-term average of 63 per cent, according to Thomson Reuters data.

However, only 53.3 per cent have topped revenue forecasts, below the 61 percent average since 2002.

The Dow Jones industrial average was up 30.57 points, or 0.20 per cent, at 15,576.32. The Standard & Poor’s 500 Index was down 0.28 points, or 0.02 per cent, at 1,756.26. The Nasdaq Composite Index was down 7.57 points, or 0.19 per cent, at 3,912.13.

European stock markets eased off five-year highs amid signs of weakness in regional corporate earnings. The pan-European FTSEurofirst 300 index of leading European companies fell 0.31 per cent to close at 1,288.67.

The euro fell 0.74 per cent to $1.3482. Renewed pressure on the euro saw the dollar index rise to a six-week high of 80.785, climbing further up from a nine-month trough of 78.998 plumbed a week earlier. It last traded at 80.777.

The dollar was up 0.43 per cent against the yen at 98.77 yen, according to Reuters data.

US Treasuries prices fell for a third consecutive session as the encouraging ISM report on manufacturing suggested the US economy overcame a drag from the partial government shutdown in October.

The rosier data revived some worries among investors that the Fed might scale back its bond-buying earlier than expected - at its December meeting – rather than early in 2014.

The benchmark 10-year US Treasury note was down 19/32in price to yield 2.6108 per cent.

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