(MENAFN– ecpulse)
European stocks remained lower Wednesday, slightly extending losses despite dovish remarks from U.S. Federal Reserve Chairman Ben S. Bernanke before the release of FOMC minutes.
Sentiment in the equity markets in currently sounds downbeat but traders are likely holding their grounds until U.S. data sees the light later today. The U.S. economic row includes retail sales, existing home sales and consumer price as well as the minutes of the Fed`s October meeting. The FOMC will hopefully offer the latest on the tapering debate underway inside the Fed.
As of 05:56 EST:
- Stoxx Europe 600 was down 0.35% at 321.43
- Stoxx Europe 50 fell 0.24% to 2,879.35
- Britain`s FTSE 100 fell 0.50% to 6,664.30
- France`s CAC 40 fell 0.39% to 4,255.78
- Germany`s DAX 30 fell 0.26% to 9,169.18.
The losing streak in mid-session trade was fueled by a 1.45% slump in telecommunication shares, leading the losers among the Stoxx 600, followed by utilities and banking shares, falling 0.73% and 0.63% respectively.
Minutes from the Bank of England (BOE)`s last policy meeting released today showed a unanimous vote to holding both interest rate and stimulus. The decision was supposed to boost the equity market but caution was dominating the sentiment already before the Fed`s key release.
BOE governor Mark Carney and the other eight MPC members voted to keep both interest rate at its current low level of 0.50% and amount of asset purchases at 375 billion pounds as the economy shows strengthening recovery and inflation hovers near the bank’s lower bound.
Equities in Europe remained lower despite Bernanke`s latest remarks on stimulus, while he boosted a stronger case for an ultra-easy monetary policy for at least for a long period as been called for by other Fed officials including Janet Yellen, who has been nominated to succeed him.
The Fed surprised the markets by not slowing the pace of bond purchases in September and stood pat on interest rates in October due to uncertainty over the state of the world`s largest economy amid a government shutdown and gridlock in Congress over the debt ceiling.
Apparently, pressure remains evident across the broad market before the release of minutes from the Fed`s last policy meeting, so stay tuned for any upcoming clues about when the central bank will start trimming its $85 billion monthly bond purchases!
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