Crude prices push European markets down

On Tuesday stocks fell in Europe as energy producers got caught in a downdraft in crude prices and reversed an earlier gain. Bonds extended a slump triggered by last week’s hawkish rhetoric from central bankers.

WTI failed to break through $45 a barrel as Goldman Sachs Group Inc. warned measures by the Organization of Petroleum Exporting Countries to clear a surplus won’t go far enough without sustained inventory declines and a drop in the rig count. The dollar gained against most major peers while petrocurrencies including Russia’s ruble, Mexico’s peso and Norway’s krone led declines.

The reversal has exposed mounting doubt over a risk rally that has taken stocks to all-time highs. Analysts have started to cut their forecasts for company earnings amid concern valuations are elevated. Central banks are withdrawing almost a decade of stimulus even though macro data show a mixed outlook, creating concern they could sap a global growth recovery.

The Euro Stoxx 50 Index lost 0.3 percent as of 11:14 a.m. in London, following a 0.4 percent gain Monday. S&P 500 futures traded little changed.

West Texas Intermediate crude dropped 0.7 percent to $44.07 a barrel before U.S. government data forecast to show crude stockpiles extended declines. Gold was down 0.3 percent at $1,210.66 an ounce, near the lowest since March on expectations of tighter monetary policy.

The yen weakened 0.2 percent to 114.31 per dollar, extending declines to a third day. Japan’s Topix Index climbed 0.7 percent. Hong Kong’s Hang Seng Index strengthened 1.6 percent, heading for its first back-to-back gain in three weeks. The Hang Seng China Enterprises Index soared 2.1 percent, its biggest advance since March 16. The Shanghai Composite Index was down 0.3 percent after a short-lived advance mid-afternoon local time. Other indexes on the mainland were also lower.