Global Stocks Slide After Fed, Ahead of ECB

LONDON (Reuters) - World stocks slid on Thursday following the Federal Reserve's decision to keep interest rates near zero for "an extended period" and ahead of policy decisions by the European Central Bank and Bank of England.

The dollar climbed against major currencies, recovering from a post-Fed sell off and as the stock sell-off hit the euro.

Investors were also bracing for Friday's monthly U.S. jobs report, which often prompts volatility on financial markets.

"Investors were pushing the market lower, preparing for more selling by investors such as hedge funds in case U.S. jobs data raises a disturbance," said Tsuyoshi Segawa, an equity strategist at Mizuho Securities.

MSCI's all-country world stock index <.MIWD00000PUS> was down 0.5 percent. The pan-European FTSEurofirst <.FTEU3> slid 1.3 percent and Japan's Nikkei <.N225> closed down 1.3 percent.

The Fed's closely watched policy statement late on Wednesday was somewhat more upbeat than its statement in September.

However, it was also more explicit about why it expects to keep rates low for some time yet, citing "low rates of resource utilization, subdued inflation trends, and stable inflation expectations," none of which point to a buoyant economy.

That took the edge off a Wall Street rally and the mood carried over into Asia and Europe, where investors were also jittery about the ECB and BoE.

Neither is expected to raise interest rates, but there will be a focus on any changes to other policies designed to pump money into ailing economies.

Bank of New York-Mellon said it did not expect the ECB to change interest rates.

"But given the hawkish eyes with which the ECB sees the world, it would be prudent to suppose that the risks of an unexpectedly hawkish policy line are credible and hence that some imminent dismantling of its "emergency' measures is entirely plausible," it said.