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LONDON: US and European equities dipped Tuesday, despite Asian gains, with sentiment dented by renewed Chinese economic concerns and fears over the unwinding of central bank stimulus, dealers said.

The Dow was down 0.2 percent minutes after the opening bell while London, Frankfurt and Paris were giving up around half of one percent mid-session compared with Friday's close.

The drop came as EU statistics body Eurostat reported that annual eurozone inflation has risen by its highest level in a decade on rising costs of energy, goods and services.

The body estimated inflation in the bloc would come in at 3.0 percent in August, up from 2.2 in July, the highest level since 2011 and above the European Central Bank's target of 2.0 percent.

The European single currency hit a 3.5-week peak at $1.1832 after last week's remarks from US Federal Reserve boss Jerome Powell while oil prices fell as investors assessed the damage to refineries after Hurricane Ida slammed into the rig-heavy Gulf of Mexico, and on the eve of an output meeting of OPEC and other key producers.

"Downside risks for the final months of the year remain -- which makes confidence in the central banks' plans for unwinding pandemic stimulus all the more important," OANDA analyst Craig Erlam told AFP.

"The services PMI from China overnight was a reminder of those risks, with the Delta variant continuing to drive rising case numbers in the US and elsewhere."

As the Dow dipped, the S&P 500 and Nasdaq also slipped off record highs, with the Schwab Market Update noting "markets continue to grapple with the lingering Delta variant (and) Fed tapering expectations, and as we likely decelerate from peak earnings and economic growth rates.

European stocks on course for seventh straight month of gains

"The global markets are digesting softer-than-expected Chinese manufacturing and services activity and a hotter-than-expected consumer price inflation report out of the Eurozone," Schwab added.

British Airways parent company IAG was off almost 4 percent as London's top faller with travel stocks hit hard by Monday's news that EU states are to recommend reimposing travel restrictions on US tourists over rising covid infections in the country.

Asian indices had earlier ended in positive territory as investors overcame early selling pressure sparked by PMI data indicating China's economic recovery had been slowed down by an outbreak of the fast-spreading Delta Covid variant.

The positive energy stoked by a pledge from Powell to be cautious in withdrawing the bank's vast financial support appeared to have dissipated at the open, replaced by fresh concerns over Beijing's crackdown on private enterprises and the ever-present spectre of the coronavirus.

The day got off to a weak start after China released figures showing activity in the services industry contracted last month for the first time since February 2020.

Authorities imposed strict travel restrictions on swathes of the country this month to contain its worst outbreak of Covid since the initial pandemic with dozens of cities affected and tens of millions of people subject to containment measures.

The moves saw flights cancelled and tourist spots closed while events were called off in a bid to nip the flare-up in the bud.

Key figures around 1400 GMT

New York - Dow: DOWN 0.3 percent at 35,335.04

London - FTSE 100: DOWN 0.5 percent at 7,111.83 points

Frankfurt - DAX 30: DOWN 0.4 percent at 15,825.58

Paris - CAC 40: DOWN 0.3 percent at 6,668.16

EURO STOXX 50: DOWN 0.2 percent at 4,189.23

Tokyo - Nikkei 225: UP 1.1 percent at 28,089.54 (close)

Hong Kong - Hang Seng Index: UP 1.3 percent at 25,878.99 (close)

Shanghai - Composite: UP 0.5 percent at 3,543.94 (close)

Euro/dollar: UP at $1.1819 from $1.1797

Pound/dollar: UP at $1.3761 from $1.3760

Euro/pound: UP at 85.90 pence from 85.73 pence

Dollar/yen: DOWN at 109.79 yen from 109.92 yen

West Texas Intermediate: DOWN 1.1 percent at $68.44 per barrel

Brent North Sea crude: DOWN 1.0 percent at $72.70 per barrel

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