European stocks may drift lower on Thursday after U.S. President Donald Trump signed into law legislation backing pro-democracy protesters in Hong Kong, a move that threatens to complicate trade talks with Beijing.
China reiterated its retaliation threat and said the Hong Kong Human Rights Democracy Act seriously interferes in the internal affairs of China violating international laws and basic principles of foreign relations.
Elsewhere, the YouGov poll showed that U.K. Prime Minister Boris Johnson is on course to win a solid majority of 68 seats in Parliament.
Asian markets slipped into the red, though losses remained limited as Trump's move didn't come as a surprise.
"We urge the U.S. to not continue going down the wrong path, or China will take countermeasures, and the U.S. must bear all consequences," the Chinese Foreign Ministry said in a statement.
Safe-haven assets such as the gold and the Japanese yen rose while the Chinese yuan fell in offshore trade due to concerns about a potential increase in geopolitical risk.
Oil extended losses from the previous session after a report showed U.S. crude inventories grew unexpectedly last week.
In economic releases, the U.K. service sector sentiment weakened in three months to November, survey data from the Confederation of British Industry showed.
Among business and professional services, sentiment about the general business situation continued to deteriorate. But the pace of decline slowed to -20 percent from -31 percent.
Economic confidence figures from euro area and consumer price inflation data from Germany are due later in the session, headlining a busy day for the European economic news.
U.S. stocks rose for a fourth straight session to reach fresh record closing highs overnight after President Trump said trade talks are "going very well."
Upbeat durable goods orders and GDP data also underpinned sentiment ahead of the Thanksgiving Day holiday on Thursday and an abbreviated trading schedule on Friday.
The Dow Jones Industrial Average edged up 0.2 percent, the tech-heavy Nasdaq Composite climbed 0.7 percent and the S&P 500 gained 0.4 percent.
European markets rose on Wednesday, helped by positive rhetoric on the U.S.-China trade front and promising consumer confidence figures out of France.
The pan-European Stoxx Europe 600 index gained 0.3 percent. The German DAX and the U.K.'s FTSE 100 both rose around 0.4 percent while France's CAC 40 index slid 0.1 percent.