European stocks closed slightly lower on Wednesday after investors eyed new record highs on Wall Street and digested a subdued U.K. budget announcement.
Italian banks fall
The pan-European Euro Stoxx 600 ended 0.07 percent lower, paring any of the significant gains it made when the euro zone composite purchasing managers' index (PMI) for November came in at 54.1, the highest since December 2015 and up from 53.3 in October, according to data provider Markit.
Banks, insurance and telecoms stocks all ended in negative territory. Italian banks were leading losses ahead of a referendum on constitutional reform on December 4 and shares of Banca Pop Milano, Ubi Banca and Banco Popolare had fallen more than 3 percent before paring most of the losses by the close. Most European banks closed in the red as the European Commission announced a plan to strengthen capital requirement rules.
Meanwhile in the U.S., stocks were mixed as investors focused on a number of economic data releases before Thanksgiving. The Dow Jones Industrial Average set a new record high on Wednesday and was trading 0.13 percent higher at 11.30 ET, while the broader S&P 500 was off by 0.25 percent.
UK budget ahead
U.K. Finance Minister Philip Hammond presented his first U.K. budget on Wednesday, known as theAutumn Statement, after telling Britain that the country needed a "fiscal reset." He announced an increase in the minimum wage and investments in infrastructure to offset negative impacts from Brexit.
The U.K. government cut its growth forecast for 2018 from 2.1 percent to 1.7 percent. It is expecting economic growth of 1.4 percent this year, down from an earlier prediction of 2.2 percent. Hammond scrapped a target to reach an economic surplus by 2020, saying the budget deficit will be closed as soon as possible.
Oil prices lower
Oil prices had been trading lower as a result of escalating doubts that OPEC members will reach a consensus over an output cut.The 14-member cartel are considering a cut of 4 to 4.5 percent in oil production and Iran, one of two nations alongside Iraq to have been hesitant that a deal could be reached, came out in support of a deal on Wednesday.