World stocks muted as reality check taken on gains BANGKOK World stocks were muted Tuesday as a string of record highs on Wall Street instilled caution about a possible bubble in stock markets fueled by easy monetary policy. The Dow Jones industrial average has surged 900 points since early October and crossed the 16,000-point threshold Monday. Wall Street has not suffered a significant pullback in the past two years even though the U.S. economic recovery has been painfully slow. Comments from influential investor Carl Icahn during the Reuters Global Investment Outlook Summit also reinforced jitters that stock prices are out of step with reality. "Icahn feels many companies' earnings are a mirage and earnings may be fuelled more by low interest rates than strong management," said Stan Shamu, market strategist at IG in Melbourne, Australia. "At such elevated levels investors are always looking for excuses to take some profits off the table," Shamu said. In Europe, Britain's FTSE 100 fell 0.6 percent to 6,680.19 and France's CAC-40 shed 0.8 percent to 4,288.25. Germany's DAX was off 0.4 percent at 9,185.23. Futures pointed to a retreat on Wall Street, with Dow and S&P 500 futures both down 0.1 percent. Japan's Nikkei 225 stock average closed down 0.3 percent at 15,126.56 and China's Shanghai Composite Index dropped 0.2 percent to 2,193.13. Australia's S&P/ASX 200 lost 0.6 percent to 5,352.90. Hong Kong's Hang Seng was little changed at 23,657.81. Markets in Southeast Asia mostly fell. On the upside, Seoul's Kospi rose 1 percent to 2,031.64. Stocks around the world had been buoyant over the past few trading sessions, largely in the slipstream of developments on Wall Street. The catalyst was Janet Yellen, who is slated to become the next Fed chairman. She expressed strong support for the Fed's low interest-rate and bond buying policies, which have been credited with propping up the U.S. economy and have contributed to the gains in stock markets since the aftermath of the 2009 global recession. Markets, however, remain on edge for signs the central bank will start reducing its purchases of government bonds and mortgage securities totaling $85 billion a month. That stimulus, by keeping interest rates low, has pushed money into stock markets in search of better returns. Benchmark U.S. crude for December delivery was down 13 cents at $92.90 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 81 cents to $93.03 on Monday. In currencies, the euro rose to $1.3514 from $1.3503 late Monday. The dollar fell to 99.69 yen from 99.91 yen.