A sculpture in front of the former building of the Frankfurt stock exchange by artist Reinhard Dach

London (AFP) - European stock markets were mostly lower Tuesday, with inflation worries offsetting optimism over reopened economies, traders said.

After stock market gains across most of Asia, some European indices proceeded to tumble, with Frankfurt’s DAX 30 index leading the way with a loss of around one percent in afternoon exchanges.

Eurozone inflation was confirmed at 0.9 percent in January compared with minus 0.3 percent in December, official data showed, adding to concerns that price increases are picking up momentum.

London’s benchmark FTSE 100 stocks index slipped by 0.1 percent, a day after British Prime Minister Boris Johnson set out a roadmap to begin easing England’s coronavirus lockdown from March.

But in a sign of more pain to come, British unemployment is now near five-year high at 5.1 percent, official data showed Tuesday, and it could surge further after the government removes a furlough support scheme that is keeping millions of workers in jobs.

Elsewhere, the pound traded near a three-year high against the dollar.

Bitcoin tumbled 14 percent to $47,255 after US Treasury Secretary Janet Yellen criticised the virtual currency, claiming it was an inefficient means of payment and underscored the vast amount of energy needed per transaction.

Oil prices also declined following fresh gains a day earlier.

While there is growing hope that vaccine rollouts will help the global economy get back on track, nagging concern over inflation and subsequent interest rate hikes is now weighing on stock markets.

In addition, “investors are quickly rediscovering that not all stocks are created equal in a Covid recovery as expensive tech names (are sold) to provide the source of funds for less expensive travel-related markers, along with energy and other inflation beneficiaries”, said Axi strategist Stephen Innes.

“Airline shares roared higher on the promise of a salvaged summer season,” said Markets.com analyst Neil Wilson, while noting that “international travel will remain problematic and subject to restrictions, isolation and testing”.

- Key figures around 1445 GMT -

London - FTSE 100: DOWN 0.1 percent at 6,603.36 points

Frankfurt - DAX 30: DOWN 1.0 percent at 13,815.91

Paris - CAC 40: FLAT at 5,770.37

EURO STOXX 50: DOWN 0.6 percent at 3,678.32

New York - Dow: DOWN 0.4 percent at 31,409.03

Hong Kong - Hang Seng: UP 1.0 percent at 30,632.64 (close)

Shanghai - Composite: DOWN 0.2 percent at 3,636.36 (close)

Tokyo - Nikkei 225: Closed for a holiday

Euro/dollar: DOWN at $1.2142 from $1.2161 at 2145 GMT

Pound/dollar: UP at $1.4066 from $1.4064

Euro/pound: DOWN at 86.32 pence from 86.44 pence

Dollar/yen: UP at 105.38 yen from 105.07 yen

Brent North Sea crude: DOWN 0.6 percent at $64.83 per barrel

West Texas Intermediate: DOWN 1.1 percent at $61.04 per barrel

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