European stocks steady, Bitcoin nears record high

London — European stock markets steadied on Wednesday tracking earnings and economic data, while Bitcoin neared its record high after it forayed into Wall Street.

The dollar rose against its main rivals, while oil prices retreated. 

Bitcoin briefly rallied to $64,475, less than $400 off its all-time high, as a financial instrument dedicated to the unit made its debut on the New York Stock Exchange.

It later retreated to $64,265.

The Bitcoin Strategy ETF, a new exchange-traded fund linked to Bitcoin futures rather than directly to the currency, rose nearly 5 per cent.

The fund should be a more accessible vehicle for mainstream investors, and could therefore boost trading in the cryptocurrency.

"There is a possibility that the impact of the ETF's launch might already be priced in, and we could see some 'buy-the-rumour, sell-the-fact' type of reaction in the days ahead," noted ThinkMarkets analyst Fawad Razaqzada.

Known for its volatility, Bitcoin could also "easily break the record high, before potentially climbing towards $70,000... which is the next psychological hurdle", he added.

Elsewhere, Asian stock markets mostly closed higher on Wednesday.

Hong Kong led the gains, jumping more than 1 per cent, with market heavyweight Alibaba rallying following reports that founder Jack Ma was on a trip to Europe — fanning hopes that China's long-running crackdown on the firm may have run its course.

Strong corporate earnings lent support, while investors kept tabs on comments from the Federal Reserve (Fed) as it prepares to bring an end to its vast financial support programme.

Signs of progress on US President Joe Biden's massive spending bill provided an extra lift.

Strong profit reports from big-name firms over the past week have reinforced optimism that the corporate sector is, for now, weathering a recent slowdown in economic growth, supply chain issues and surging inflation, providing a much-needed boost to worried traders.

Johnson & Johnson, United Airlines and Netflix were the latest positives from the reporting season, adding to top Wall Street banks, including JPMorgan Chase, Bank of America and Morgan Stanley last week.

Inflation 

Rising prices and the end of central bank largesse continued to cast a shadow however.

Concerns about surging inflation running out of control have forced several central banks to hike interest rates already — with others to soon follow — and the prospect of an end to the era of cheap cash has caused an 18-month equity rally to stutter.

British annual inflation cooled slightly in September, official data showed on Wednesday, remaining close to a nine-year peak that still risks a UK interest rate rise next month.

Despite the headline figure easing, analysts still expect the Bank of England to next month raise its main interest rate from a record-low level of 0.1 per cent.

While some countries have already started the tightening cycle, all eyes are on the Fed owing to its oversized role in the global economy.

The European Central Bank, meanwhile, will lose an opponent of ultra-loose monetary policies as news emerged that Jens Weidmann plans to step down as head of the German central bank at the end of the year.