The dollar slumped and US equities headed for their first back-to-back daily declines of the month as the rally that sent Wall Street stocks to record highs since Donald Trump’s US election victory paused ahead of the Christmas holiday weekend.
Stocks have surged since the November 8 election, but were lower in light trading as traders took profits.
The Dow, Nasdaq and S&P 500 have all risen more than five per cent in the six weeks since Mr Trump’s victory, with the Nasdaq and Dow both touching record highs earlier this week.
The Dow Jones Industrial Average fell 21.68 points, or 0.11 per cent, to 19,920.28, the S&P 500 lost 3.97 points, or 0.18 per cent, to 2,261.21 and the Nasdaq Composite dropped 14.27 points, or 0.26 per cent, to 5,457.16.
The US dollar, which has also surged since Election Day on bets that President-elect Trump’s policies will spur economic growth and inflation, fell 0.3 per cent against a basket of currencies, pulling further away from the 14-year high it set earlier this week.
Traders brushed off data showing the US economy grew at its fastest pace in two years in the third quarter and booked profits on bullish dollar bets.
European markets were also broadly lower, with the pan-European STOXX 600 index down 0.4 per cent, falling for the second straight session after marking its highest level since January 4.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.7 per cent with the Nikkei finishing 0.1 per cent lower, having hit one-year highs this week.
Hong Kong’s Hang Seng index was down 0.8 per cent after touching its lowest level since July, though Australian shares finished up 0.5 per cent, extending gains into a fourth straight session.
A metric of stocks markets around the globe fell 0.2 per cent.
Emerging market bourses saw the sharpest of the day’s declines in equities with MSCI’s emerging markets index falling more than one per cent to a one-month low. It has closed lower in six of the last seven sessions.
The US election outcome has slammed emerging market currencies and equities as Trump’s campaign pledges to rewrite trade deals and a steep rise in US interest rates and the value of the dollar, which increases the cost of repaying loans many countries have in US currency, have sent investors fleeing for the exits.
US Treasury yields edged up slightly after the GDP data, and as investors prepared for new Treasury supply next week.
Benchmark 10-year Treasury yields rose to 2.577 per cent.
Yields have risen by around 80 points since the US election.
Oil prices rose by around one per cent, spurred by the pause in the dollar rally and optimism that crude producers would abide by an agreement to limit output to prop up prices.
Copper prices fell to one-month lows as a sharp drop in imports by top consumer China fuelled worries about demand.