US Stocks Ease Back From Record Highs

(AP) -- Stocks are off to a mixed start on Wall Street Wednesday, a day after the S&P 500 and the Dow Jones Industrial Average set their latest record highs. Several big technology companies were posting solid gains, led by Microsoft, which reported a 24% surge in profits last quarter as its cloud computing business bounded ahead. The S&P 500 was wobbling between small gains and losses in the early going, as was the Dow. The Nasdaq was up 0.5%. McDonald's was also up 3.3% after turning in results that beat forecasts. The yield on the 10-year Treasury fell to 1.57%.

Global stock markets fell Wednesday after Australian inflation rose to a six-year high and a Chinese newspaper warned more real estate developers are likely to default on bonds, while investors looked ahead to U.S. economic growth data due out this week.

London and Frankfurt opened lower, shrugging off strong U.S. corporate profit reports. Shanghai, Tokyo and Hong Kong declined.

Australia reported inflation accelerated to an unexpectedly high level in the latest quarter, highlighting investor fears central banks might feel pressure to cool prices by pulling back stimulus that is pushing up stocks.

Adding to unease about Chinese finance, an official newspaper, the Global Times, cited industry analysts as saying more developers are likely to default on bonds amid pressure from regulators to cut their debt levels.

A midsize developer, Modern Land, said it missed a $250 million payment due Monday. Investors are watching whether one of the biggest developers, Evergrande Group, can avoid a default on 2 trillion yuan ($310 billion) of debt.

Investors are "refusing to chase the carrots dangled by an impressive U.S. earnings season," said Jeffrey Halley of Oanda in a report.

"China, once again, appears to be the culprit," Halley said. He said Australian inflation is "increasing nerves" that its central bank will shift from its ultra-dovish stance.

In early trading, the FTSE 100 in London lost 0.3% to 7,253.67 and the DAX in Frankfurt sank 0.4% to 15,701.84. The CAC 40 in France gave up 0.3% to 6,744.37.

On Wall Street, futures for the benchmark S&P 500 index and the Dow Jones Industrial Average were off 0.1%.

On Tuesday, the S&P 500 index rose 0.2% to its second high in two days, driven by strong earnings reports by some major companies. The Dow and Nasdaq composite edged up less than 0.1%.

In Asia, the Shanghai Composite Index fell 1% to 3,562.31 after reports that China has halted freight trains bound to and from Europe due to border congestion. Also Tuesday, Washington revoked the license of a unit of state-owned China Telecom Ltd. to operate in the United States as a security risk.

The Nikkei 225 in Tokyo lost less than 0.1% to 29,098.24 and the Hang Seng in Hong Kong declined 1.6% to 25,628.74.

The Kospi in Seoul ended 0.8% lower at 3,025.49 while India's Sensex retreated 0.4% to 61,106.32.

Sydney's S&P ASX 200 ended less than 0.1% higher after the Australian government reported underlying inflation accelerated by unexpectedly strong 0.7 percentage points to an annual rate of 2.1% in the three months ending in September.

"A jump in Australian core inflation highlighted intensifying cost pressures in the global economy," said Anderson Alves of ActivTrades in a report.

Investors were waiting for U.S. economic growth data due out Thursday that might influence whether the Federal Reserve changes its timeline for reducing stimulus.

In energy markets, benchmark U.S. crude lost $1.20 to $83.45 per per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the price basis for international oils, shed 90 cents to $84.75 per barrel in London.

The dollar declined to 113.69 yen from Tuesday's 114.17 yen. The euro declined to $1.1590 from $1.1598.