World stock markets wobbled Thursday as investors awaited an expected interest rate cut from the Bank of England to counter Brexit fallout.

London dipped 0.1 percent in tentative morning deals as investors waited on whether the BoE will unveil a quarter-point reduction to combat the economic impact of Britain's shock EU exit vote.

In the eurozone, Frankfurt stocks won 0.6 percent and Paris gained 0.2 percent in value.

The British central bank, which announces its decision at 1100 GMT, is widely forecast to cut borrowing costs to a new record low at 0.25 percent. It is also set to slash its economic growth forecasts following the June 23 Brexit referendum.

The bank's rate-setting Monetary Policy Committee (MPC) could decide to re-activate its quantitative easing (QE) bond-buying programme, under which it has already pumped £375 billion ($500 billion, 446 billion euros) of cash into the economy to boost lending.

"Equities were muted in early trading after positive sessions on Wall Street and in Asia, with the market looking to the Bank of England's interest rate call when a cut is widely expected," said Russ Mould, investment director at brokerage AJ Bell.

He added: "Further monetary stimulus from the Bank of England could provide a boost to markets.

"On the flip side, a decision to maintain interest rates and QE at their current levels could be a nasty surprise and markets generally do not like surprises.”

- First cut in seven years -

A rate cut would be the first since March 2009, when the bank slashed rates to the current historic low of 0.50 percent at the height of the financial crisis -- and launched its radical QE policy.

Alan Wilde, head of fixed income at Baring Asset Management, sounded a note of caution on Thursday.

"The risk today is that markets are anticipating too much in the way of immediate easing when the MPC may wish to keep some powder dry to act in the future -- should circumstances demand they do so," Wilde said.

Elsewhere, Asian stocks rose following a positive lead from Wall Street, as investors look ahead to both the BoE and US jobs data.

Oil prices extended gains, giving a lift to energy and mining stocks after mixed data from the US Department of Energy showed crude supplies up, but falling gasoline stock.

A better-than-expected reading on US private jobs also supported a Wall Street rally, with payroll firm ADP reporting that private US companies added 179,000 jobs in July, slightly better than expected. 

The US is due to announce official job creation data for July on Friday, with markets looking for signs that could increase the likelihood of a hike in US interest rates.

Shanghai ended up 0.1 percent as investors await the release of economic data next week, including on trade, investment and retail sales.

British stocks had dipped Wednesday as more gloomy data suggested an economic hit from the Brexit vote, on the eve of the BoE decision.

A gauge of activity in Britain's key services industry showed contraction in July, feeding fears the country will slip into recession this year.

- Key figures at 1030 GMT -

London - FTSE 100: DOWN 0.1 percent at 6,627 points

Frankfurt - DAX 30: UP 0.6 percent at 10,229

Paris - CAC 40: UP 0.2 percent at 4,330.80

EURO STOXX 50: UP 0.6 percent at 2,928.30

Tokyo - Nikkei 225: UP 1.1 percent at 16,254.89 (close)

Shanghai - Composite: UP 0.1 percent at 2,982.43 (close)

Hong Kong - Hang Seng: UP 0.4 percent at 21,832.23 (close)

New York - DOW: UP 0.2 percent at 18,355.00 (close)

Euro/dollar: DOWN at $1.1135 from $1.1148

Pound/dollar: DOWN at $1.3294 from $1.3316

Dollar/yen: UP at 101.47 yen from 101.25 yen

Source: AFP