By Chris Harris and Amanda Cooper

NEW YORK/LONDON (Reuters) – Global stocks were down and major Wall Street indexes fell on Thursday after the European Central Bank cut interest rates for a fourth time this year, and gold prices dropped.

European stocks pared losses after the European Central Bank cut interest rates and kept the door open to further easing in 2025.

The Swiss franc weakened after the Swiss National Bank cut rates by half a point, its largest reduction in nearly 10 years. Markets had priced a good chance of a half-point cut in the run-up to Thursday’s meeting.

The U.S. dollar rose against a range of other currencies, though it weakened against the yuan.

Oil prices eased as a forecast for ample supply in the oil market offset optimism stemming from rising expectations of a U.S. interest rate cut.

MSCI’s gauge of stocks across the globe fell 0.52 points, or 0.06%, to 870.87.

Wednesday’s inflation reading showed the consumer price index (CPI) rose exactly in line with expectations in November, supporting bets for a Federal Reserve interest rate cut next week.

“The market has essentially seen one of the last remaining obstacles that could derail sentiment out of the way”, said Chris Weston, head of research at Pepperstone.”Seeing the coast somewhat clearer for the illustrious seasonal chase of returns to play out into year-end.”

Traders now place a 97% chance on a quarter-point Fed cut on Dec. 18.

The Dow Jones Industrial Average rose 33.41 points, or 0.08%, to 44,183.33, the S&P 500 fell 17.72 points, or 0.29%, to 6,066.47 and the Nasdaq Composite fell 100.05 points, or 0.50%, to 19,934.85.

Europe’s STOXX 600 eased 0.02%, while emerging market stocks rose 0.53%.

Traders were pricing in 125 basis points worth of interest rate cuts by the ECB end of 2025, according to data compiled by LSEG.

“The ECB is on a direct path of consecutive quarter-point cuts until the deposit rate reaches 2%. This market expectation is now being reinforced by even lower economic forecasts,” said Jochen Stanzl, chief market analyst at CMC Markets.

The yield on benchmark U.S. 10-year notes rose 2.3 basis points to 4.295%, from 4.271% late on Wednesday.

CENTRAL BANK FOCUS

The dollar fell against the Japanese yen after Reuters reported that BOJ policy makers were inclined to forgo a hike on Dec. 19 and wait for more data on wages at the start of next year.

The Australian dollar surged on unexpectedly strong employment data, rebounding from Wednesday’s weakness following a Reuters report that Beijing is considering allowing the yuan to depreciate further next year. China is Australia’s top trading partner and the Aussie is often used as a liquid proxy for the yuan.

Although economists were almost unanimous in predicting Thursday’s move by the ECB, many had acknowledged that a bigger cut would also be justified given a deteriorating growth outlook and rapidly retreating inflation.

In commodities, spot gold fell 1.11% to $2,687.93 an ounce. U.S. gold futures fell 1.73% to $2,686.60 an ounce.

Crude oil retreated after rallying this week on the threat of additional sanctions aimed at stifling Russian oil output.

U.S. crude fell 0.77% to $69.75 a barrel and Brent fell to $73.10 per barrel, down 0.57% on the day.

(Additional reporting by Kevin Buckland in Tokyo; Editing by Edwina Gibbs, Michael Perry, Angus MacSwan, William Maclean and Ed Osmond)

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