AKIPRESS.COM - European shares pulled back on Wednesday from 21-month highs hit after strong earnings while the dollar fell on concerns that U.S. President Donald Trump's dismissal of his FBI chief could make passage of his tax reform plans more difficult.

Expectation-beating first-quarter company results have lifted stock markets across the globe, with European full-year earnings forecasts set to be their best since 2010. The prospect of U.S. tax cuts has also helped push shares higher, Reuters reported.

At the same time, measures of market volatility are at rock-bottom. The U.S. VIX index fell on Tuesday to 9.56, its lowest since late 2006.

The pan-European STOXX 600 index fell 0.2 percent, led down by construction and materials stocks, having hit its highest since August 2015 on Tuesday.

Asian shares, however, edged up for a third consecutive day. MSCI's main index of Asia-Pacific shares, excluding Japan rising 0.1 percent, having earlier matched a two-year high hit last week.

Twelve-month forward earnings-per-share for the index is at its highest level in more than three years.

South Korean stocks led losers as investors took profits after liberal leader Moon Jae-in was elected president, while Chinese shares closed lower after factory gate prices ion the world's second-biggest economy cooled more than expected in April.

Tokyo shares hit a 17-month high, up 0.3 percent on the day as a relatively weak yen outweighed concerns triggered by Trump's sacking of Comey.

The U.S. president said he had fired Comey, who had been leading an investigation into the Trump 2016 campaign's possible collusion with Russia, over his handling of an email scandal involving then-Democratic candidate Hillary Clinton.

The dollar fell 0.1 percent against a basket of major currencies after slipping on the view that political uncertainty could derail Trump's tax reform plans, the prospect of which has helped lift riskier assets.

The yen, often sought in times of market uncertainty, was last 0.1 percent higher at 113.83 to the dollar. The euro was flat at $1.0870.