European stocks rally stalls as traders assess Venezuela fallout, economic data

By Niket Nishant

Jan 7 (Reuters) - European stocks were subdued on Wednesday after a streak of record closes, as investors took a breather to digest the latest U.S.-Venezuela developments and awaited fresh economic data.

The STOXX 600 index .STOXX was marginally lower as of 0920 GMT, a day after notching a record closing high.

While markets have largely looked past the flare-up in global geopolitical risks so far, investors were cautious after U.S. President Donald Trump said the United States had reached a deal to import $2 billion worth of Venezuelan crude, a move that is expected to increase supplies.

Oil prices fell in response to Trump's comments. Shares of UK energy heavyweights Shell SHEL.L and BP BP.L dropped 2.4% and 3.1%, respectively, while the European energy index .SXEP fell 1.7%.

"Sometimes, there is a little bit of worry that complacency sets in. But investors have generally looked past geopolitics in recent years and have been rewarded for doing so," said Richard Flax, chief investment officer at wealth management firm Moneyfarm.

"Even if momentum sometimes breaks, markets are premised on an operating environment that is supportive and an earnings environment that is decent."

DATA TO DRIVE SENTIMENT

Traders also assessed a stream of data releases, which will be pivotal to shaping the macroeconomic narrative. The U.S. Labor Department's Job Openings and Labor Turnover Survey, also called the JOLTS report, is due on Wednesday.

The benchmark in Germany .GDAXI rose 0.44%, and indexes in Spain .IBEX and Italy .FTMIB were flat. All three had hit all-time peaks a day earlier.

The unemployment rate in Germany, euro zone's largest economy, rose less than expected in December. On the other hand, retail sales in November fell unexpectedly.

In France, data showed that consumer confidence rose in December. The CAC 40 index .FCHI drifted 0.2% lower.

Among individual movers, French voucher and benefits company Pluxee PLX.PA rose 3.5%, hitting its highest since November, after reporting a 9% organic growth in first-quarter sales.

Chip equipment maker ASML ASML.AS fell 2%, snapping a six-day winning streak, its longest since November.

Nestle NESN.S dipped 0.1% after brokerage firms Jefferies and Bernstein lowered their price targets on the stock. The company on Tuesday said it was recalling some batches of its infant nutrition products due to possible contamination with a toxin that can cause nausea and vomiting.