European Shares Edge Higher Ahead Of Fed Decision
European stocks advanced on Wednesday, as investors awaited the Fed’s summary of economic projections and the updated quarterly rate projections — known as the dot plot —at the conclusion of a two-day policy meeting later in the day.
The U.S. central bank is expected to maintain current interest rates despite persistent inflation levels exceeding target range.
Investors were also reacting to positive inflation data from the region.
Preliminary data from Destatis showed German producer prices declined at a record pace in August mainly due to the base effect caused by the very high price level of the previous year.
The producer price index fell 12.6 percent year-over-year in August, much faster than the 6.0 percent decline in the prior month, which was the first decline since November 2020. That was in line with economists’ expectations.
Elsewhere, data showed the U.K. consumer price inflation slowed unexpectedly in August.
U.K. consumer price index posted an annual increase of 6.7 percent in August after rising 6.8 percent in July, according to the Office for National Statistics. This was the weakest inflation since February 2022.
The pan European STOXX 600 was up half a percent at 458.70 after ending marginally lower on Tuesday.
The German DAX gained half a percent, France’s CAC 40 edged up 0.2 percent and the U.K.’s FTSE 100 was up 0.6 percent.
Semiconductor company STMicroelectronics rose 1.5 percent after extending its CEO’s contract.
Ryanair Holdings was slightly higher despite the Italian Competition Authority opening an investigation on its Italian unit for an alleged exclusionary abuse of dominant position.
Germany’s Merck KGaA rose about 1 percent after it entered into a new Al-led drug discovery collaboration with Escientia Plc.
Pearson tumbled 4 percent after the British education group appointed Microsoft executive Omar Abbosh as its new CEO, effective early 2024.
Just Eat Takeaway soared 7.5 percent after its U.S. unit Grubhub was allowed to sue New York City over a law capping how much it can charge restaurants for delivering meals.
Housebuilder Barratt Developments rallied 3.9 percent, Persimmon jumped over 4 percent and Taylor Wimpey surged 4.6 percent after data showed British house prices increased by 0.6 percent in the 12 months to July.
German automakers BMW, Mercedes Benz and Volkswagen all rose about 1 percent after data showed EU car sales grew 21 percent in August.
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