(MENAFN– ecpulse)
European stocks kicked off a choppy trade on Wednesday, holding at their lowest levels this month on speculation the Federal Reserve will start to slow the pace of its monetary stimulus program in September.
- STOXX Europe 600 lost 0.10% to 301.96
- Euro Stoxx 50 fell 0.28% to 2,697.91
Equities were mixed in Europe and Asia, while bonds and currencies remained down, as traders eagerly anticipate any clues on whether the Fed soon begin to wind down its massive $85 billion per month bond-buying plan. The Federal Open Market Committee (FOMC) is due to release the minutes at 7 p.m. London time.
Some analysts suggest Chairman Ben S. Bernanke is going to reverse course as soon as September, while others expect the tapering move to come by the end of this year.
The consensus, in general, considers the possibility that monetary policy could tighten again sooner rather than later.
Global markets are anxious about how the policy vote went at the Fed`s last meeting, but focus for many remained the continuing rise in interest rates, after we saw yields on the 10-year treasury note hit a two-year on Monday.
Therefore, traders will be closely tracing any leads over interest rates, and Wednesday’s minutes from the last Fed meeting could offer so when the US central bank will wind down its massive monetary stimulus plan.
- British FTSE 100 fell 0.44% to 6,425.01
- France CAC 40 rose 0.15% to 4,034.80
- German DAX shed 0.17% to 8,286.09
Asian stocks reversed early gains on Wednesday, following heavy losses in many markets on Tuesday amid growing bets the Fed will move to reverse course next month. In the U.S., Wall Street closed mixed and losses were contained as bond yields eased from to-year highs.
On the corporate front, Heineken NV fell 3.8 percent after the German brewer said profit will stagnate this year.
Vestas Wind Systems rallied more than 9.0 percent after appointing Aners Runevad as CEO and group president.
Back in the UK, public finances data is due to be released showing whether the latest signs of economic recovery are starting to show up on Britain`s balance sheet.
Economists call Chancellor of the Exchequer George Osborne to record a surplus of 2.9 billion pounds in July`s borrowing figures, compared with June`s deficit of 8.5 billion.
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