By David Hodari 

Global stocks wavered Wednesday as investors absorbed a fresh dose of uncertainty over the U.K.'s attempts to leave the European Union.

The Stoxx Europe 600 was up 0.3% with mild, broad-based gains in opening trading. The index's banking sector climbed 0.9% after its Italian constituents came under pressure Tuesday, following reports that the European Central Bank wants them to clean up their bad loans more effectively.

British assets gave a tepid reaction to the U.K. parliament's overwhelming rejection of Prime Minister Theresa May's proposed Brexit deal late Tuesday. The defeat was the largest suffered by a sitting British government since at least the beginning of the 20th century.

The FTSE 100 ticked down 0.3%, underperforming other European benchmarks, as the British pound edged up 0.1% against the U.S. dollar, and falling by the same amount against the euro. Market participants saw a lower likelihood of the country leaving the European Union without a deal.

"The probability of a softer Brexit or remaining in the EU has gone up more than anything else as a result of the vote in parliament last night, and that offsets persistent uncertainty," said John Wraith, head of U.K. rates strategy and economics at UBS.

The yield on 10-year U.K. government debt was rose to 1.287% from 1.259% late Tuesday. Yields rise as prices fall.

The gains in stocks across much of Europe followed mixed trading in Asia. Japan's Nikkei benchmark ticked 0.6% lower after hitting a four-week high Tuesday, while the Shanghai Composite Index was flat and the Shenzhen A-Share fell 0.1%. Hong Kong's Hang Seng gained 0.3%.

In the U.S., futures pointed to gains of 0.3% for the S&P 500 and the Dow Jones Industrial Average. On Tuesday tech stocks had led Wall Street higher following the People's Bank of China's move to reassure markets of its intention to support waning economic growth in the world's second-largest economy.

A slew of gloomy economic figures out of China in recent weeks have concerned investors about the state of broader global growth, although an acceleration in the rise of Chinese house prices soothed those jitters.

In commodities, Brent crude oil was up 0.3% at $60.84 a barrel, while gold climbed 0.2% to $1,290.45 a troy ounce.

Write to David Hodari at David.Hodari@wsj.com

 

(END) Dow Jones Newswires

January 16, 2019 04:24 ET (09:24 GMT)

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