Sawt Falasteen - Stock markets edgy, oil prices rise on conflict, steady US inflation

The International Energy Agency said the risk of oil supply disruptions owing to the conflict was limited, but added it stood ready to intervene in markets if necessary.

With the exception of London, which advanced slightly, major markets were just off, the Dow down 0.3 percent half an hour into the Wall Street session, while oil prices added almost 2 percent.

There has been plenty of optimism on equity trading floors in recent days after a US jobs report was neither too hot nor too weak, while a string of central bank decision-makers have lined up to suggest they backed a pause in any more monetary tightening.

In the latest remarks, Boston Fed chief Susan Collins said the policy board was being more patient now that rates were at or close to their peak, while Atlanta boss Raphael Bostic said that unless prices surged again, officials did not need to keep hiking.

While the producer price index came in well above estimates Wednesday, analysts said it was seen more as a blip in a generally disinflationary environment.

Ahead of the consumer prices data, Russ Mould, investment director at AJ Bell warned that any growth "would not go down well" after hotter-than-expected producer price inflation figures.

SPI Asset Management's Stephen Innes took a longer view, suggesting "the future direction of events really depends on how economic indicators play out.

"Unless inflation unlikely trends higher or resurgent signs of a demand-supply imbalance in the labour market lead to a wage-price spiral, we think the Fed will continue to tap a less hawkish beat."

Minutes from the Fed's most recent policy meeting showed they would keep interest rates elevated "for some time" until inflation has been brought to heel.

- China boost -

In Asia, the mood was enhanced by news that China's massive sovereign wealth fund had bought stakes in the country's biggest banks, fuelling speculation it could broaden its reach to support beleaguered mainland markets.

Hong Kong and Shanghai equity indices rallied on news that China's Central Huijin Investment -- an arm of the $1.4 trillion China Investment Corp -- had bought $65 million of shares in the country's banking giants.

Analysts said the purchase of stakes in Bank of China, Agricultural Bank of China, China Construction Bank, and Industrial and Commercial Bank of China was aimed at boosting sentiment in mainland markets, which have been hit by worries over the stuttering economy.

- Key figures around 1345 GMT -

New York - Dow: DOWN 0.3 percent at 33,706.48 points

London - FTSE 100: UP 0.3 percent at 7,644.13 points

Frankfurt - DAX: DOWN 0.2 percent at 15,422.19

Paris - CAC 40: DOWN 0.3 percent at 7,106.72

EURO STOXX 50: UP 0.1 percent at 4,204.11

Tokyo - Nikkei 225: UP 1.8 percent at 32,949.66 (close)

Hong Kong - Hang Seng Index: UP 1.9 percent at 18,238.21 (close)

Shanghai - Composite: UP 0.9 percent at 3,107.90 (close)

Euro/dollar: DOWN at $1.0619 from $1.0621 on Wednesday

Pound/dollar: DOWN at $1.2247 from $1.2314

Dollar/yen: UP at 149.46 yen from 149.18 yen

Euro/pound: UP at 86.27 pence from 86.23 pence

Brent North Sea crude: UP 2.0 percent at $87.55 per barrel

West Texas Intermediate: UP 1.9 percent at $85.09 per barrel

Q.Jaber--SF-PST