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Global stocks rebounded Thursday in choppy trade as investors assessed the outlook for interest rates after the previous day's sharp losses.
On Wall Street, mega-cap stocks helped up the S&P 500 and Nasdaq higher, but the blue chip Dow was marginally lower in late morning trading.
European markets closed higher, as did most Asian markets.
Oil prices rose as continued unrest in the Middle East weighed on sentiment.
Global stocks had sunk Wednesday as stronger-than-expected US retail sales data dimmed hopes for an early start to US Federal Reserve rate cuts, while weak Chinese growth data gave cause for concern.
London had also been hit by an unexpected but modest acceleration in inflation, which also dampened talk of rate reductions from the Bank of England.
Hopes for an early cut by the European Central Bank have also been doused by boss Christine Lagarde who warned no such move was foreseen until the summer.
"Stock markets are modestly higher on Thursday, recovering some of Wednesday's losses as investors seemingly struggle to determine where things stand," said market analyst Craig Erlam at OANDA.
"There's clearly a desperate desire to cling on to the optimism that enabled such a strong end to the year but unlike in that period, the data isn't really playing ball," he added.
December US retail sales out Wednesday smashed forecasts and data released Thursday showed first-time claims for unemployment insurance fell back under 200,000 last week.
The figures followed surprisingly high readings this month on consumer prices and jobs creation, as well as minutes from the Fed's most recent meeting that showed officials were keen to keep rates elevated for some time to contain inflation.
While the data has dimmed hopes of an early rate cut this year, on the other hand it reassures investors about the state of the US economy.
The British capital's FTSE 100 also shifted back into the black following bright news in the betting sector, after gambling giant Flutter revealed surging annual sales and an imminent US listing.
The news sent its share price rocketing 15 percent to top the FTSE 100 risers board.
In Asia, stocks mostly trod higher, but gains were capped by a lack of meaningful measures by Beijing to boost China's economy following news of poor 2023 growth.
Hong Kong and Shanghai enjoyed some rare gains on bargain-buying after recent losses, though worries about China's economic outlook continued to drag on sentiment following Wednesday's soft economic growth figures.
Oil prices rose Thursday after Islamabad said it had carried out strikes against militant targets in Iran, with Tehran reporting a death toll of seven civilians after staging its own air raid in Pakistan earlier this week.
That came after the United States launched more strikes on Huthi positions in Yemen as punishment for the Tehran-backed group's attacks on shipping in the Red Sea, which has ramped up worries about supplies of oil and other exports through the waterway.
- Key figures around 1630 GMT -
New York - Dow: DOWN less than 0.1 percent at 37,237.79 points
New York - S&P 500: UP 0.5 percent at 4,762.45
New York - Nasdaq: UP 1.2 percent at 15,039.37
London - FTSE 100: UP 0.2 percent at 7,459.09 (close)
Paris - CAC 40: UP 1.1 percent at 7,401.35 (close)
Frankfurt - DAX: UP 0.8 percent at 16,567.35 (close)
EURO STOXX 50: UP 1.1 percent at 4,453.05 (close)
Tokyo - Nikkei 225: FLAT at 35,466.17 (close)
Hong Kong - Hang Seng Index: UP 0.8 percent at 15,391.79 (close)
Shanghai - Composite: UP 0.4 percent at 2,845.78 (close)
Euro/dollar: DOWN at $1.0865 from $1.0883 on Wednesday
Dollar/yen: DOWN at 148.03 yen from 148.16 yen
Pound/dollar: UP at $1.2687 from $1.2676
Euro/pound: DOWN at 85.65 pence from 85.84 pence
West Texas Intermediate: UP 1.3 percent at $73.48 per barrel
Brent North Sea Crude: UP 0.8 percent at $78.48 per barrel
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