Oil prices slid, moving below US$50 a barrel, amid concern that current efforts to reduce the global glut aren't sufficient.
"Evidence is mounting that the OPEC agreement, and the market's reaction, were much ado about nothing," John Kilduff, a partner at Again Capital, a New York-based hedge fund that focuses on energy, told Bloomberg.
In fresh evidence of a solid US labour market before Friday's nonfarm payrolls data, a Labour Department report showed that initial claims for state unemployment benefits declined 19,000 to a seasonally adjusted 238,000 for the week ended April 29.
"The tightening labour market is raising costs but firms are failing to improve productivity to offset those increases," Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania, told Reuters. "There simply is no reserve army of the unemployed or underemployed to call on and hours worked are already fairly high."
In the latest US corporate results, shares of Kellogg rose after the world's biggest maker of cereal posted quarterly earning that surpassed expectations. The stock traded 1.5 per cent higher as of 1.40pm in New York.
Kellogg reported diluted earnings per share of 74 US cents a share in the quarter ended April 1, up from 49 US cents a share in the year-earlier quarter.
"In the first quarter, we managed through an unusually challenging environment for packaged food companies, including a period of industry-wide softening of consumption trends," John Bryant, Kellogg's chief executive officer, said in a statement.
"We got off to a slow start on net sales," Bryant noted, "but we expect sequential improvement in coming quarters, and our productivity initiatives enabled us to stay on track toward our full-year 2017 forecasts."
Meanwhile, rival Kraft Heinz posted quarterly revenue and earnings that "primarily reflected lower consumption versus the prior-year period in North America."
Net sales in the quarter ended April 1 slid 3.1 per cent to US$6.36 billion, the company said in a statement. It posted earnings of 84 US cents a share, excluding some items, for the quarter, up from 73 US cents in the year earlier but below analysts' expectations for 85 US cents a share.
"Although our top line results in the first quarter reflect a slow start to the year, we remain on track with our key initiatives," Kraft Heinz CEO Bernardo Hees said in the statement. "We are delivering product innovations, renovations and geographic expansion that positions Kraft Heinz to drive organic sales growth for the balance of 2017 and beyond."
"We also have good visibility on costs, savings and what we must do to deliver another year of profitable growth," Hees added.
Kraft Heinz shares traded 0.1 per cent stronger at US$89.20 as of 1.20pm in New York. Earlier in the day the stock fell as low as US$87.14 and rose as high as US$91.80.
In Europe the Stoxx 600 Index ended the session with a 0.7 per cent gain from the previous close, bolstered by stronger-than-expected earnings including from Anheuser-Busch InBev.
The UK's FTSE 100 Index rose 0.2 per cent, Germany's DAX Index climbed 1 per cent, while France's CAC40 Index rallied 1.4 per cent.
Following a TV debate between French presidential candidates Emmanuel Macron and Marine Le Pen on Wednesday night, polls showed Macron was seen as the winner.
