Morning Chronicle - Stocks split on China, US consumer confidence

But US equities were hit by another disappointing economic sentiment indicator, reviving investor concerns about the impact of a likely recession.

The news from China came as Beijing and Shanghai appeared to have contained a Covid outbreak that had forced officials to impose lockdowns that compounded global supply chain snarls, further pushing up inflation.

Authorities said inbound travellers would have to quarantine for only 10 days instead of three weeks.

The news boosted share prices, already striving to rebound from recent sharp losses triggered by fears of a global recession.

"The Covid crisis appears to be rapidly retreating in China," noted Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

"The prospects of rapid recovery for the world's second largest economy is helping lift miners, as metals prices rise in expectation of a surge in demand in the commodity-hungry economy."

Asian markets closed higher, with both Hong Kong and Shanghai rising 0.9 percent.

At the same time, G7 leaders meeting in Germany condemned China's "non-transparent and market-distorting" international trade practices in an end-of-summit statement that hit out directly at Beijing for the first time.

Traders also digested comments from European Central Bank President Christine Lagarde, who said the ECB would go "as far as necessary" to fight inflation that is set to remain "undesirably high".

Paris rose 0.6 percent and Frankfurt added 0.4 percent. London climbed 0.9 percent.

Global equity markets have been recovering ground as investors believe central banks could decide to raise interest rates by more modest amounts than previously thought.

The US Federal Reserve and its peers are hiking borrowing costs in an attempt to cool inflation, which has soared around the world to the highest levels in decades.

Such action has increased the prospect of a global recession, causing economists to think that future rate hikes could be less steep than in recent months.

But early gains on Wall Street evaporated following a new report showing a drop in US consumer confidence.

The Conference Board's monthly consumer confidence index fell to 98.7 from 103.2, its lowest level since February 2021, as US consumer prices rise at their fastest pace in more than four decades.

"It looks like investors are potentially underestimating the big macro risks facing them by bidding up equity prices over the last few days," City Index analyst Fawad Razaqzada told AFP.

"It is far too early to be optimistic that this latest recovery will hold."

The Dow was down 0.4 percent in late morning trade, while the S&P 500 slid 0.7 percent and the tech-heavy Nasdaq Composite fell 1.4 percent.

- Oil jumps as G7 targets Russia -

Oil prices, a major driver of the soaring inflation, rose on fears of further supply tightening, in addition to prospects for higher Chinese demand.

This comes after G7 leaders agreed to work on a price cap for Russian oil, a US official said Tuesday, as part of efforts to cut the Kremlin's revenues.

International sanctions placed on Russia following its invasion of Ukraine are taking their toll.

Moody's ratings agency has confirmed that Russia defaulted on its foreign debt for the first time in a century, after bond holders did not receive $100 million in interest payments.

- Key figures at around 1530 GMT -

New York - Dow: DOWN 0.4 percent at 31,324.65 points

EURO STOXX 50: UP 0.2 percent at 3,506.13

London - FTSE 100: UP 0.9 percent at 7,323.41 (close)

Frankfurt - DAX: UP 0.4 percent at 13,231.82 (close)

Paris - CAC 40: UP 0.6 percent at 6,086.02 (close)

Tokyo - Nikkei 225: UP 0.7 percent at 27,049.47 (close)

Hong Kong - Hang Seng Index: UP 0.9 percent at 22,418.97 (close)

Shanghai - Composite: UP 0.9 percent at 3,409.21 (close)

Brent North Sea crude: UP 2.0 percent at $113.22 per barrel

West Texas Intermediate: UP 1.4 percent at $111.11 per barrel

Euro/dollar: DOWN at $1.0527 from $1.0583 Monday

Pound/dollar: DOWN at $1.2188 from $1.2268

Euro/pound: UP at 86.35 pence from 86.24 pence

Dollar/yen: UP at 136.26 yen from 135.48 yen

burs-rl/kjm

E.M.Hall--MC-UK