NEW YORK World stock markets edged up for a sixth straight session on Wednesday after upbeat trade data from China soothed worries about slower global growth, while the British pound rose to a two-week high against the dollar.
The Dow and S&P 500 closed down slightly, however, snapping four days of gains after Procter & Gamble (PG.N), the world's largest maker of consumer products, cut its outlook for profit and sales growth.
The Chinese trade data showed solid demand, with exports rising in January, easing fears that the world's second-largest economy is mired in a worsening slowdown and reviving investors' appetite for emerging market assets that had been battered in recent weeks.
The broad MSCI All-Country World Index .MIWD00000PUS was up 0.3 percent on the day, while the FTSEurofirst 300 index .FTEU3 ended up 0.7 percent. Europe is one of China's largest trading partners.
MSCI's index of emerging market stocks added 0.9 percent .MSCIEF, extending a bounce from five-month lows hit earlier this month.
"Emerging markets look like they're beginning to find their footing. I believe we're back to viewing the global economy being in a glass-half-full expansion," said Eric Teal, chief investment officer at First Citizens Bancshares Inc. in Raleigh, North Carolina, which manages $3.5 billion.
On Wall Street, the Dow Jones industrial average .DJI fell 30.83 points, or 0.19 percent, to 15,963.94; the S&P 500 .SPX lost 0.49 points, or 0.03 percent, to 1,819.26; and the Nasdaq Composite .IXIC added 10.243 points, or 0.24 percent, to 4,201.288.
Procter & Gamble shares lost 1.7 percent to $77.49 and weighed on both the Dow and S&P 500 after the company cut its sales and earnings growth outlooks for the year to reflect unfavorable foreign exchange rates in Venezuela and the devaluation of currencies in various developing markets.
The lackluster move in U.S. stocks followed a rally on Tuesday after the U.S. House of Representatives voted to suspend the debt limit until March 2015 and the Federal Reserve's new chief, Janet Yellen, held off from making any changes to the central bank's schedule for trimming stimulus.
The debt ceiling deal pressured U.S. bond prices for a second day, though. Benchmark 10-year Treasuries were down 13/32 in price to yield 2.76 percent. Ten-year yields earlier hit 2.77 percent, their highest level since January 29.
"Overall, there's less uncertainty," said David Coard, head of fixed-income sales and trading at Williams Capital Group in New York. "I know that the debt ceiling resolution had a negative effect on the bills, but it had a positive effect on the longer end. So it all came together to see the sell-off that we're seeing."
BANK OF ENGLAND BOOSTS GROWTH FORECAST
The Bank of England indicated that interest rates may need to rise in just over a year and lifted its growth forecast, sending the pound up against the dollar and the euro.
"The BoE seems to become the first major central bank, bar the Reserve Bank of New Zealand, to hike interest rates," said Chris Turner, chief currency strategist at ING. "We are expecting a rate hike in February 2015, so in the short term sterling looks good, especially against the euro."
Sterling jumped to a two-week high of $1.6587, up 0.8 percent on the day.
In commodities markets, gold prices ended little changed on profit-taking after rising to a three-month high near $1,300. Spot gold was up 0.2 percent to $1,293.55, after hitting a three-month high at $1,295.91.
U.S. oil futures traded above $100 per barrel for the entire session for the first time since October 18, and settled at the highest point since then, after data showed TransCanada Corp's (TRP.TO) Gulf Coast pipeline began in earnest to drain oil from benchmark delivery point Cushing, Oklahoma.
Brent crude gained 11 cents to settle at $108.79, while U.S. crude oil rose 43 cents to settle at $100.37.
(Additional reporting by Gertrude Chavez-Dreyfuss and Ryan Vlastelica in New York and; Anirban Nag in London; Editing by Dan Grebler and Leslie Adler)