Global equities pulled back from recent record highs on Wednesday, with investors turning cautious after underwhelming euro zone PMI data and ahead of central bank meetings.

US jobs data due Friday was also on investors’ minds, with the dollar index hitting an 11 1/2-year high, while the euro crashed through support levels that have held for more than a month. It hit a six-week low under pressure from the imminent launch of the European Central Bank’s bond-buying programme.

The MSCI All Country World equity index slipped 0.2 per cent, with Asian shares lower overall despite data showing a modest pick-up in China’s services sector and a surprise rate cut in India that boosted bonds and the rupee.

European markets were flat overall — with equities and bond yields ticking up — after data showed price cutting and a weaker currency were the main drivers of an acceleration in euro zone business activity in February.

Markit’s final composite purchasing managers’ index (PMI) came in slightly weaker than a preliminary estimate although activity last month was at a seven-month high.

With major central banks at a crossroads as the ECB embarks on bond buying to further lower interest rates and spur growth, while the Federal Reserve is paving the way for a rate hike, investors are focused on data points that could give clues to the direction of future policy, especially the Fed’s.

“Investors are turning a bit more cautious given the ECB tomorrow (Thursday) as well as the US payrolls (data) on Friday,’’ said Saxo Bank trader Andrea Tueni.

“It’s not a surprise to see a pause in the rally; stocks have been on fire since the start of the year, some people are cashing in a bit.’’

India’s central bank was the latest to surprise markets with a rate cut, lowering its policy repo rate by 25 basis points to 7.5 per cent on Wednesday. That was its second inter-meeting cut this year on the back of easing inflation and what it said was the “weak state’’ of parts of the economy.

The pan-European FTSEurofirst 300 equity index was up 0.1 per cent, with the shares of Standard Chartered hitting their highest level since October after the bank ruled out plans to raise capital despite reporting a 25 per cent slide in annual pre-tax profits.

In commodities markets, Brent crude dipped but held above $60 a barrel, supported by a rise in Saudi crude prices and air strikes on facilities in Libya.

Gold prices edged higher after a two-day losing streak, though the metal could remain under pressure due to expectations of robust US economic data and higher US interest rates, while London nickel held around a 14-month low.

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