European shares slipped from 13-month highs on Wednesday as investors weighed up whether signs of progress in the euro zone debt crisis warranted the recent surge and as Japan provided a reminder of the slump blighting top economies.
The uncertainty over Europe's debt woes have left many major economies stuttering, but many big stock markets have risen 15-20 percent since June on expectations of central bank action to address the crisis.
After falls in Asia on the back of a plunge in Japanese export numbers, top European shares opened down 0.8 percent, with London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX all in negative territory.
Europe's battle to overcome its debt problems remains the central focus for many global investors, and the next few days will kick off a string of meetings that could go a long way in shaping the future course of the crisis.
Greek Prime Minister Antonis Samaras meets with head of the Eurogroup of euro zone finance ministers, Jean-Claude Juncker, in Athens late in the afternoon before travelling to Berlin on Thursday to see German Chancellor Angela Merkel and French President FranÃ§ois Hollande.
"The recent rally in share prices has not at all been based on the outlook for earnings - in fact completely the opposite. It has been entirely built on hopes of large scale ECB intervention in euro zone periphery bond markets," said Tammo Greetfeld, equity strategist at UniCredit in Munich.
"We are at the start of a multi-week period of key political events such as the Greek meetings, the ECB meeting on September 6 and the German court decision on the ESM the week after."
"We think the outcome of these factors, in combination with the negative earning revisions means the current rally will not last and that equities markets will decline," he added.
Hopes surrounding a new bond buying plan being drawn up by the ECB helped lift the euro to a seven-week high against the dollar late on Tuesday. It held on to much of those gains in early European trading to stand at $1.2456.
Bond markets took their cue from nervous equities, with German government bonds back in demand at the expense of their Italian and Portuguese counterparts.
Germany will sell 5 billion euros of bonds later and is again expected to pay nothing to borrow the money as the euro zone's debt worries and fears the bloc could split leave investors clambering for ultra-safe German assets.
Later in the day the U.S. Federal Reserve will publish the minutes of its most recent meeting, which will be scoured for clues on whether the central bank is gearing up for more policy aid.