* European shares hold at 21-month highs
* Wall Street opens lower after news of FBI director firing
* Dollar dips vs peers
* Greek yields hit lowest since 2012 debt restructuring
(Updates to U.S. market open, recasts open, changes dateline,
By Dion Rabouin
NEW YORK, May 10 Oil prices rebounded on
Wednesday after a steeper-than-expected drop in U.S. crude
inventories, helping limit equity losses on Wall Street, while
European stocks held near their highest in nearly two years.
European full-year earnings forecasts, set to be their best
since 2010, and centrist Emmanuel Macron's victory in France's
presidential election over the weekend have steadied European
bourses so far this week.
The pan-European FTSEurofirst 300 index rose 0.05
percent and MSCI's gauge of stocks across the globe
gained 0.05 percent.
MSCI's All-Country World Index was flat at
Oil prices rose after Saudi Arabia said it would cut
supplies to Asia and U.S. inventories fell more than expected.
Brent crude was last up 2.6 percent to $50.02 a barrel.
In the United States, disappointing results from Dow
component Walt Disney and President Donald Trump's
firing of FBI Director James Comey has given equities some
pause, but Wednesday's price action was hardly a selloff,
Trump said he fired Comey, who had been leading an
investigation into the Trump 2016 campaign's possible collusion
with Russia, over his handling of the email scandal.
"The market has been unusually stable for a long period;
we’ve had a long stretch of not many big moves up or down," said
Giri Cherukuri, head trader at OakBrook Investments LLC in
"The market has been able to absorb a lot of geopolitical
news, but one of these days we’ll have a big geopolitical event
and we’ll have a big reaction to that."
The Dow Jones Industrial Average fell 21.5 points, or
0.1 percent, to 20,954.28, the S&P 500 lost 0.35 points,
or 0.01 percent, to 2,396.57 and the Nasdaq Composite
dropped 9.06 points, or 0.15 percent, to 6,111.53.
Traders said Comey's firing could lead to serious
complications for the administration, but without a "smoking
gun" that showed Comey's firing was motivated by something other
than Comey's handling of a probe into then-Democratic
presidential nominee Hillary Clinton, there was likely to be
limited market reaction.
"What’s the biggest concern is how much of a distraction
does it have from the White House’s and the Congress’ goals,"
said Jeffrey Carbone, senior partner, Cornerstone Financial
Partners, in Huntersville, North Carolina.
"How much does this distract from tax reform, repeal of (the
Affordable Care Act), repatriation of assets, infrastructure
spending? And it seems to be fairly muted right now."
Measures of market volatility are at rock-bottom. The U.S.
VIX index fell on Tuesday to 9.56, its lowest since late
The dollar fell 0.1 percent against a basket of major
currencies after slipping on the view that political
uncertainty could derail Trump's tax reform plans.
The yen, often sought in times of market uncertainty,
was last 0.1 percent higher at 113.92 to the dollar. The
safe-haven Swiss franc rose against the dollar to a
nearly one-month high.
Benchmark 10-year U.S. Treasury yields were down
3.1 basis points to 2.38 percent after retreating from five-week
highs touched on Tuesday as investors made room in their
portfolios for new issuance of government and corporate debt.
Gold rose 0.12 percent to $1,222 an ounce.
Greek 10-year yields on Wednesday fell to their
lowest since its debt was restructured in 2012. Greek stocks
rose for a twelfth straight session, the longest streak since
1991, bringing the country's benchmark index close to erasing
all losses it made since reopening after an emergency bourse
closure in the summer of 2015.
Athens and its creditors reached a deal this month on
reforms that could trigger the release of more rescue funds.
(Reporting by Dion Rabouin; Additional reporting by Nigel
Stephenson in London)