Volkswacht Bodensee - Eurozone stocks wobble, euro hits 5-year dollar low

Meanwhile, Wall Street recovered from sharp losses the previous day over worries about the impact of expected interest rate hikes on tech stocks as more firms reported earnings.

Oil prices fell on concerns about Covid-19 lockdowns in China hitting demand despite worries about Russian supplies.

Russia's energy giant Gazprom said Wednesday it had stopped gas supplies to Bulgaria and Poland, and has threatened to do the same to other countries which refuse to pay in rubles, which would violate EU sanctions imposed over the war in Ukraine.

Europe's reference gas price, Dutch TTF, bounded higher but remained well below levels hit last month.

"We're seeing a little bit of positivity back in the markets on Wednesday but there's still plenty of underlying unease amid a mixed bag of earnings and rising uncertainty," said market analyst Craig Erlam at OANDA.

He said Russian threats to cut off gas were a clear reason why and that they could play havoc with energy prices and act as a headwind on the European economy and stocks.

"The weaponisation of gas was long seen as an unlikely last resort but now the Kremlin has got the ball rolling, the risk has become significantly greater which could pose a massive economic threat to the EU," said Erlam.

Paris and Frankfurt stocks both dipped into the red in afternoon trading, but finished with modest gains.

Meanwhile, the euro dropped under $1.06, sinking as low as $1.0515, to record its lowest level since January 2017.

Markets.com analyst Neil Wilson said the "market clearly believes the Fed is going to town on rate hikes and the ECB is going to sit on its hands and do nothing".

On Wall Street, all three main indices were solidly higher even if they had clawed back only a fraction of Tuesday's losses.

Tech firms, who rely on debt to drive growth, led the Tuesday plunge on fears that the Federal Reserve is at the beginning of a period of sharp interest-rate increases aimed at taming scorching inflation, with the Nasdaq Composite tumbling four percent.

The downbeat mood over the economy has been compounded by weak earnings from some of the world's biggest companies.

"US markets have seen a modest rebound in early trade as investors pause for breath and look ahead to the latest numbers from Meta later today, and Amazon and Apple tomorrow," said Michael Hewson at CMC Markets UK.

Asian stock markets earlier closed lower but suffered losses less sharp than seen Tuesday on Wall Street.

In contrast however, Shanghai bounced on Wednesday following a report that Chinese President Xi Jinping had committed to boosting infrastructure construction as a means of accelerating the economy.

The comments were the latest from China's top brass, which has made a series of promises in recent weeks to kickstart growth.

However, analysts say this has been offset by the leaders' refusal to back away from their strict Covid lockdown strategy.

Oil prices -- under pressure recently owing to worries about weaker Chinese demand -- fell again back towards $100 per barrel.

- Key figures at 1530 GMT -

New York - Dow: UP 0.9 percent at 33,529.98 points

EURO STOXX 50: UP 1.0 percent at 3,668.35

London - FTSE 100: UP 0.5 percent at 7,425.61 (close)

Paris - CAC 40: UP 0.5 percent at 6,445.26 (close)

Frankfurt - DAX: UP 0.3 percent at 13,793.94 (close)

Tokyo - Nikkei 225: DOWN 1.2 percent at 26,386.63 (close)

Hong Kong - Hang Seng Index: UP 0.1 percent at 19,946.36 (close)

Shanghai - Composite: UP 2.5 percent at 2,958.28 (close)

Brent North Sea crude: DOWN 0.7 percent at $103.82 per barrel

West Texas Intermediate: DOWN 1.1 percent at $100.59 per barrel

Euro/dollar: DOWN at $1.0550 from $1.0636 late Tuesday

Pound/dollar: UP at $1.2527 from $1.2576

Euro/pound: DOWN at 84.20 pence from 84.55 pence

Dollar/yen: UP at 128.54 yen from 127.21 yen

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K.Thomson--BTB