US stocks slid Wednesday following data that showed a slowdown in inflation, but less than investors had expected.  

European stocks, which had been trading strongly higher, pared their gains after the US Labor Department said the consumer price index (CPI) rose by 8.5 percent in April, down from the 8.5 percent annual gain registered in March.

Briefing.com analyst Patrick J. O'Hare said the 0.3 percent month-on-month gain in the overall CPI was above the consensus expectation of 0.2 percent.

The 0.6 jump in monthly core CPI, which excludes food and energy costs, was also above the consensus of 0.4 percent.

"The key takeaway from the report is that it provided some leeway that suggests peak inflation might have been hit, but with the moderation not as significant as had been hoped, it also stirred concerns that inflation might stick at persistently high levels longer than anyone would like, including the Fed," said O'Hare.

The US Federal Reserve and other central banks have been hiking interest rates to tackle decades-high inflation, both of which tend to slow economic growth.

So far the European Central Bank has been reluctant to follow suit, but on Wednesday, ECB president Christine Lagarde hinted that it could raise interest rates from historic lows as soon as July.

On Wall Street, the Dow dipped 0.2 percent after a couple minutes of trading, with the S&P 500 shedding 0.5 percent and the tech-heavy Nasdaq dropping 1.1 percent.

In afternoon European trading, London was up 0.5 percent, Frankfurt added 0.8 percent and Paris climbed 1.2 percent.

Ahead of the inflation number, equities also won a boost from US President Joe Biden's administration looking at possibly lifting trade tariffs on China to try and control inflation.

Equities have been on another roller-coaster ride this week amid high inflation concerns, the Russian invasion of Ukraine and impact of China's Covid-19 lockdowns on supply chains.

Global investors have been spooked by China's sinking April exports -- the lowest in almost two years -- as well as data showing its consumer inflation had risen at the quickest pace in nearly half a year.

Meanwhile global oil prices rose around 5 percent on Wednesay on concerns over Russia's war in Ukraine, China's Covid lockdown and slowing US inflation.

A day after briefly falling below $100 per barrel, benchmark US oil contract WTI surged back above to $105 per barrel.

On the corporate front Wednesday, Marlboro-maker Philip Morris International said it had offered $16 billion to acquire smokeless tobacco company Swedish Match as the US group aims to move away from its traditional cigarette business.

The board of Swedish Match recommended that its shareholders accept the bid of 106 Swedish kronor per share, nearly 40 percent above its closing share price on Monday, the companies said.