(MENAFN- AFP) European stock markets steadied Wednesday as oil prices rebounded and investors awaited the outcome of the US Federal Reserve meeting.
London's benchmark FTSE 100 index rose 0.07 percent to 6,336.48 points, while in Paris the CAC 40 climbed 0.46 percent to 4,111.91 points, but in Frankfurt the DAX 30 edged down 0.02 points to 9,544.43 points.
"European equity markets were fairly mixed in today's trading session, as investors remain cautious ahead of the first round of the Presidential elections in Greece and the US FOMC rate decision," said Myrto Sokou, an analyst at Sucden Research
Greek lawmakers failed after the close of markets Wednesday to elect a new president in the first of three rounds of voting. The high-stakes ballot could lead to snap general elections, raising doubts over the future of reforms to tackle the country's economic crisis and the possibility of a new eurozone crisis.
Equities benefitted from a pause in the plunge of the ruble that had sent shockwaves though European markets on Monday and Tuesday as the Russian currency shed 10 percent and 20 percent of its value in two trading days.
Russia announced measures to support the financial system and stepped up intervention to head off a run on the currency.
Global markets have been in turmoil this week owing to concerns about the effect of plunging oil prices on energy firms as well as the crude-dependent Russian economy, which is also straining under Western sanctions.
Eyes were on the outcome of the Fed's two-day meeting, with dealers looking for some guidance over monetary policy amid growing speculation that the central bank will raise interest rates by the middle of 2015.
"Decision day for the Federal Reserve and the big question is whether they will refine their forward guidance and remove the term 'considerable time' from their description of how long they plan to keep interest rates low to something more data-dependent," said Rebecca O'Keeffe, head of investment at stockbroker Interactive Investor.
"This term is highly significant and its removal would signal the Fed's intention to start raising rates within the next few months and have a major knock-on effect for both equity and bond markets. However, given current market fragility, the Fed will need to tread carefully."
The prospect of a tighter US monetary policy helped push up the dollar, with the euro sliding to $1.2407 from $1.2498 late in New York on Tuesday. The British pound also lost ground to the dollar and was at $1.5655.
Wall Street moved higher Wednesday following a weak US inflation report, and then moved higher after the United States and Cuba made a historic breakthrough in their Cold War stand-off, moving to revive diplomatic ties and ease a five-decade US trade embargo against its communist foe.
The Dow Jones Industrial Average stood at 17,168.55 points in midday trade, a gain of 0.58 percent from Tuesday's close.
The broad-based S&P 500 advanced 1.11 percent to 1,994.63, while the tech-rich Nasdaq Composite Index rose 0.68 percent to 4,578.68.
- 'Roller coaster ride' -
The ruble opened down around 3.0 percent, but rebounded after to 61.80 to the dollar from 67.88 on Tuesday evening. It rose to 78 to the euro from 85.15.
The rise came after Prime Minister Dmitry Medvedev voiced confidence that Moscow can contain the crisis and the finance ministry said it was selling around $7 billion at its disposal to prop up the ruble.
Russia's central bank also announced a series of technical measures to ease access to foreign currency and shore up banks.
The Russian central bank had earlier raised its key interest rate to 17.0 percent from 10.5 percent in a bid to prop up the currency which touched lows Tuesday that left the ruble losing some 60 percent of its value this year.
But the move "has failed to stabilise the ruble," said Sebastien Barbe, head of emerging market research and strategy at Credit Agricole.
The rate rise and plunging oil prices suggest "a meaningful recession next year", Barbe said in a note to clients.
In late London deals, Brent crude for February was up $2.44 to $62.45 a barrel and US benchmark West Texas Intermediate for January rose $2.27 to $58.20 after US oil stockpiles dropped by 800,000 in the week to December 12.
That was less than forecast by analysts, but the market chose to focus on the drop, an indication of higher demand.
"Markets are on a true roller-coaster ride at the moment, as the domino effects from lower oil prices translate into mounting risks for countries, sectors and individual stocks," O'Keeffe said.
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