Stocks fell around the world on Wednesday as the price of crude declined after a strike by Kuwaiti oil workers ended.

Brent and US crude oil futures prices dropped as worries about oversupply in the oil market returned to the fore.

The FTSEurofirst 300 index of leading European shares responded by falling 0.3 per cent. The MSCI All-Country World index also fell.

The MSCI World Index, which tracks stocks from developed economies, slipped 0.1 per cent and the MSCI Emerging Market index dropped 0.7 per cent.

Recent gains by European stocks, which reached three-month highs earlier this week, were just a temporary bounce in a longer-term decline, said Andreas Clenow, a hedge fund manager at ACIES Asset Management.

The FTSEurofirst remains down around 5 per cent so far in 2016. “We are still in a bear market,” Mr Clenow said. The tumbling oil price also hit commodity-linked currencies such as the Australian and Canadian dollars, which pulled back from their recent peaks. The end of the Kuwait strike revived the bearish mood brought on by the failure of talks on output by major producers in Dohama last weekend. They could not agree to limit production and reverse a slump in prices since mid-2014.

“We were bearish before Doha. Prices had risen too far on false hopes of a deal. Now that this has been corrected, we’re more neutral in our price outlook,” said Georgi Slavov, head of research at commodities brokerage Marex Spectron.

“Generally, we think that oil prices have passed their bottom this year, and we expect a Brent price range of $45-$55 per barrel for the mid-term,” Mr Slavov added.

Earlier Japan’s Nikkei clung to a 0.2 per cent gain thanks to the recent pullback in the yen, but was running into profit taking above the 17,000 barrier.

On Wall Street the Dow Jones Industrial Index had ended Tuesday with gains of 0.27 per cent, while the S&P 500 rose 0.31 per cent to close above 2100 for the first time in 2016.

But the Nasdaq eased 0.4 per cent and Intel shed 3 per cent after hours as its results disappointed. The chipmaker lowered its revenue forecast and said on Tuesday it would cut 12,000 jobs globally.

Currencies were mixed with the US dollar regaining some ground against commodity currencies such as the Australian dollar as oil fell away. Against a basket of currencies, it edged up 0.14 per cent but was still not far from recent lows.

The US dollar steadied on the yen at 108.87, while the euro idled at $1.1366.

Traders said much now depends on the outcome of the European Central Bank (ECB) policy meeting on Thursday.

In March, ECB chief Mario Draghi unleashed an aggressive package but muted its impact by suggesting there would be no further cuts, giving the euro an unwelcome boost.

“Outside of some verbal discomfort at the euro’s strength and reiteration that the ECB stands ready to take further action if necessary, it is difficult to see what he can do,” analysts at ANZ wrote in a note to clients.

“The risks of a further squeeze higher in EUR/USD are significant,” they added.

Reuters