By Sara Sjolin, MarketWatch
Heineken slides after Femsa sells stake
European stocks swung between small gains and losses on Tuesday,
with investors staying cautious ahead of this week's Federal
Reserve meeting that will be scrutinized for hints on future U.S.
monetary policy.
The Stoxx Europe 600 index ended marginally higher at 382.12,
after trading in a relatively tight range during the session.
Among biggest decliners in the pan-European index, shares of
Heineken NV (HEIA.AE) slumped 3.8% after Mexico's Femsa (FMX) late
Monday said it is selling a 5.24% stake in the Dutch brewer.
Fed in focus: Traders in Europe were waiting for the U.S. Fed to
provide its policy update on Wednesday, which could affect multiple
asset classes, such as stocks globally, currencies and gold. The
two-day meeting kicks off on Tuesday.
The central bank is widely expected to keep 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).
"With investors still re-evaluating the Federal Reserve's
ability to raise U.S. interest rates in December, attention will be
directed towards Janet Yellen and her thoughts on the recent
inflation trends in the U.S.," said Lukman Otunuga, research
analyst at FXTM, in a note.
"A hawkish Yellen, who leaves the door open for another rate
hike before year-end, is likely to offer the dollar a lifeline," he
added.
If the dollar rises against the euro and pound it can give a
boost to European equities, as it means eurozone and British goods
and services become cheaper for American businesses and consumers
to purchase.
The euro bought $1.1978 on Tuesday, up from $1.1954 late Monday
in New York. The pound traded at $1.3514, up from $1.3494 on
Monday.
Read:'We were wrong'--HSBC reverses bearish pound view after BOE
rate hints
(http://www.marketwatch.com/story/we-were-wrong-hsbc-reverses-bearish-pound-view-after-boe-rate-hints-2017-09-18)
European economic news:France cut its budget-deficit forecasts
(http://www.marketwatch.com/story/france-cuts-deficit-forecasts-as-growth-improves-2017-09-19-3485480)
for this year and next after taking austerity measures over the
summer and as economic growth has been stronger than initially
expected.
In Germany, the ZEW economic expectations index jumped to 17.0
in September, up from 10.0 in August and beating forecasts of a
12.7 reading.
"The German federal elections do not seem to have been a source
of uncertainty. The worries about the recent strengthening of the
euro has, for now, also faded into the background," said ZEW
President Professor Achim Wambach in the release.
The Germans head to the polls on Sunday in a general election
where Angela Merkel widely is expected to win a fourth term as
chancellor. The big question, however, is who she chooses as her
coalition partner, as that is seen as potentially having an impact
on eurozone reforms and fiscal rules in the currency union.
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)
Indexes: Germany's DAX 30 index ended slightly higher at
12,561.79, while France's CAC 40 index gained 0.2% to 5,237.44.
The U.K.'s FTSE 100 index rose 0.3% at 7,275.25
(http://www.marketwatch.com/story/ftse-100-gets-a-lift-from-supermarket-stocks-softer-pound-2017-09-19).
Movers: Shares of J Sainsbury PLC (SBRY.LN) rose 2.6% even as
the grocer lost market share in the 12 weeks to Sept. 10.
Ocado Group PLC (OCDO.LN) fell 2% as the online grocery-delivery
company said average order size during the 13 weeks to Aug. 27 fell
1.2%, compared with the year-ago period. Overall, Ocado's revenue
rose 14% during the fiscal third quarter.
Shares of Hugo Boss AG (BOSS.XE) fell 3.6% after Morgan Stanley
downgraded the German fashion retailer to underweight from
equal-weight.
In the opposite direction, Morgan Stanley lifted its rating on
Metso Oyj (METSO.HE) to equal-weight from underweight, sending the
shares 5.8% higher.
Telia Co. AB (TELIA.SK) picked up 2.7% after the Scandinavian
telecom operator sold its final 7% stake in Turkcell Iletism
Hizmetleri AS (TCELL.IS), raising 1.78 billion Turkish lira ($513.4
million).
(END) Dow Jones Newswires
September 19, 2017 12:07 ET (16:07 GMT)
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