Stock markets wobbled Tuesday, as fading US consumer confidence undermined news that China and the United States would pursue a trade pact.
In New York, the Dow Jones index was 0.6 percent lower in midday trading, but oil prices held onto gains as an upgraded hurricane Laura threatened US oil installations in the Gulf of Mexico.
European markets started the day in an upbeat mood after China and the US said top representatives had held phone talks on the trade agreement they signed in January.
There had been concerns about the future of the deal as the countries' relationship grows increasingly fraught over issues including Hong Kong, the virus, Huawei and TikTok.
But later in the day, a closely tracked survey of US consumer confidence showed it had fallen further in August as cases of the coronavirus continued to rise.
After dropping in July, the Conference Board's consumer confidence index slipped again after its survey found that attitudes about "both business and employment conditions had deteriorated over the past month", senior director Lynn Franco said.
"Consumers' optimism about the short-term outlook, and their financial prospects, also declined and continues on a downward path," Franco added.
Joshua Mahony, a senior analyst at the online group IG, commented that "given how reliant the US is upon domestic consumption, the dramatic collapse in consumer confidence does little to lift sentiment over forthcoming spending levels for US businesses."
Global markets had previously also been underpinned by growing optimism that a coronavirus vaccine could be in the offing, and by an upbeat German business confidence indicator.
But with British pharmaceutical giant AstraZeneca "pointing towards a wait until winter 2021 for their vaccine, hopes of a speedy implementation could be ill-founded," Mahony noted.
Trader's attention turned towards a virtual meeting of central bankers in Jackson Hole, Wyoming, with the key event being Thursday's speech by Federal Reserve chief Jerome Powell.
"It feels like many market participants are sitting on their hands ahead of the Jackson Hole Symposium," remarked CMC Markets analyst David Madden.
Investors hope Powell will provide an update on the world's top economy and some forward guidance on his plans for monetary policy.
- Key figures around 1630 GMT -
London - FTSE 100: DOWN 1.1 percent at 6,037.01 points (close)
Frankfurt - DAX 30: FLAT at 13,061.62 (close)
Paris - CAC 40: FLAT at 5,008.27 (close)
EURO STOXX 50: DOWN 0.1 percent at 3,329.71
New York - Dow: DOWN 0.6 percent at 28,139.52 points
Tokyo - Nikkei 225: UP 1.4 percent at 23,296.77 (close)
Hong Kong - Hang Seng: DOWN 0.3 percent at 25,486.22 (close)
Shanghai - Composite: DOWN 0.4 percent at 3,373.58 (close)
Euro/dollar: UP at $1.1820 from $1.1788 at 2100 GMT on Monday
Dollar/yen: UP at 106.40 yen from 105.98 yen
Pound/dollar: UP at $1.3139 from $1.3063
Euro/pound: DOWN at 89.95 pence from 91.19 pence
Brent North Sea crude: UP 0.8 percent at $45.96 per barrel
West Texas Intermediate: UP 0.7 percent at $43.29