EUROPE MARKETS: European Stocks Mark Time As Investors Stay Focused On Fed Decision
September 20 2017 - 8:40AM
Dow Jones News
By Carla Mozee, MarketWatch
Thyssenkrupp shares rises on Tata deal news; Spain shares under
pressure
European stocks wavered Wednesday, with investors seeming to
hold off before the U.S. Federal Reserve's policy decision, even as
they assessed deal news from Thyssenkrupp and other corporate
updates.
The Stoxx Europe 600 index was down less than 1 point at 382.80,
with financial and tech shares leading declining sectors. But
telecoms and utility shares were among the advancing sectors. On
Tuesday, the pan-European benchmark closed up 0.1%.
(http://www.marketwatch.com/story/european-stocks-slip-as-traders-wait-for-fed-rate-update-2017-09-19)
Most major European indexes were little changed before the
highly anticipated release of the Fed's policy statement
(http://www.marketwatch.com/story/hey-fed-boss-janet-yellen-inflation-is-still-low-and-stocks-are-soaring-what-say-you-2017-09-18)
and the press conference by Fed Chairwoman Janet Yellen. Germany's
DAX 30 index slipped 0.1% and France's CAC 40 index ticked up by
0.1%. The U.K.'s FTSE 100 was fractionally higher
(http://www.marketwatch.com/story/ftse-100-edges-up-as-fed-decision-takes-center-stage-2017-09-20).
But Spain's IBEX 35 lost the most, down 1.2%, following news
that police in Spain arrested some Catalonian officials
(http://www.marketwatch.com/story/catalan-officials-arrested-in-spain-ahead-of-banned-independence-vote-2017-09-20)
for their alleged involvement in planning a vote on Catalonia's
secession from Spain. That ballot is set for Oct. 1, and has been
declared illegal by the Spanish government.
The U.S. central bank is widely expected to keep interest rates
on hold but to start unwinding its $4.5 trillion balance sheet
(http://www.marketwatch.com/story/feds-balance-sheet-unwind-will-be-moment-of-truth-for-financial-markets-2017-09-18).
Analysts said the statement may be followed by moves in several
asset classes, such as stocks, currencies and gold.
"Any caution on the economic outlook is likely to push out the
prospect that we could see another rate rise this year, and we
shouldn't forget that the problem of the [U.S.] debt ceiling has
been pushed out into December," said Michael Hewson, chief market
analyst at CMC Markets UK.
"If that remains unresolved by the time of the December meeting,
then it makes the prospect of a rate move even less likely," he
said in a note.
The euro bought $1.2003, slightly up from $1.1994 late Tuesday
in New York. But the euro has climbed about 14% against the
greenback this year.
"Depending on the post-Fed USD-appetite, the EURUSD could return
to its 200-hour moving average (1.1962), or pursue its short-term
positive trend," said LGC senior market analyst Ipek
Ozkardeskaya.
The Fed policy decision is due at 7 p.m. London time, or 2 p.m
Eastern Time. Yellen's press conference is set to start at 2:30
p.m. Eastern Time.
Stock movers: Thyssenkrupp AG (TKA.XE) shares climbed 3.6% after
the company said it and Tata Steel Ltd. (500470.BY) will combine
their European steel operations
(http://www.marketwatch.com/story/thyssenkrupp-tata-seal-european-steel-deal-2017-09-20).
The new company would be the second-largest steel producer in
Europe after ArcelorMittal (MT) . ArcelorMittal shares rose
1.1%.
Fortum Oyj (FORTUM.HE) leapt 4.8%, as the Finnish utility is in
advanced talks over a 3.76 billion euro ($4.51 billion) bid for
E.ON SE's (EONGY)stake in Germany-based energy company Uniper SE
(http://www.marketwatch.com/story/fortum-in-talks-on-45-billion-uniper-stake-bid-2017-09-20)(UN01.XE).
E.On shares rose 3% and Uniper shares climbed 6.4%.
Kingfisher PLC (KGF.LN) shares popped up 6.2%. The home
improvement retailer said it's on track to meet targets in the
second year of its five-year restructuring plan, as it raised its
dividend. But Kingfisher's first-half profit fell 6%
(http://www.marketwatch.com/story/kingfisher-pretax-profit-hurt-by-weak-french-sales-2017-09-20),
and it stayed cautious in its outlook for its core U.K. and French
markets.
Shares of Inditex SA (ITX.MC) fell 1.7% after the Spanish
retailer's Zara chain had a bigger-than-expected decline in
profitability
(http://www.marketwatch.com/story/zara-parent-inditex-profit-up-but-margin-falls-2017-09-20),
triggered in part by currency fluctuations. Overall, the autumn and
winter sales season got off to a more robust start than expected,
the company said.
Deutsche Telekom AG shares (DTEGY) was up 1.4%, extending gains
logged Tuesday. Those moves followed a CNBC report that Sprint
Corp. (S) is in talks to merge with Deutsche Telekom's T-Mobile US
Inc. (TMUS) unit.
Data: The U.K.'s Office for National Statistics said retail
sales rose by a faster-than-expected rate of 1% in August
(http://www.marketwatch.com/story/uk-retail-sales-rise-faster-than-expected-2017-09-20).
That sending the pound on a brief rally above $1.3600, visiting
levels not since June 2016, just after the Brexit referendum.
Read:Don't call the German election boring--it could be huge
leap or setback for the eurozone
(http://www.marketwatch.com/story/dont-call-the-german-election-boring-it-could-mean-a-huge-shift-for-the-eurozone-2017-09-18)
(http://www.marketwatch.com/story/dont-call-the-german-election-boring-it-could-mean-a-huge-shift-for-the-eurozone-2017-09-18)Also
read:German election: Who's Merkel up against and what are their
chances?
(http://www.marketwatch.com/story/german-election-whos-merkel-up-against-and-how-could-they-shape-the-new-government-2017-08-31)
(END) Dow Jones Newswires
September 20, 2017 08:25 ET (12:25 GMT)
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