Equities Indices

European shares broadly flat ahead of Fed rate decision

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European shares are little changed from the open, Wednesday afternoon, amid subdued activity ahead of the US Federal Reserve’s interest rate announcement due later. Volumes are typically lower ahead of a Fed decision, as investors await fresh guidance from the Central Bank and any economic outlook tweaks.

By around 1440 BST, the EUROSTOXX 600 edged 0.01% lower, while the EUROSTOXX 50 was just 0.11% higher. Regional bourses were equally mixed, but steady. The German DAX fell 0.26%, the French CAC rose 0.28% and the Spanish IBEX was 0.25% in the green.

US Fed rate decision

European market activity is a little slower Wednesday, as investors take a breath ahead of the US Fed’s rate decision and the press conference that will follow.

The US central Bank is widely expected to hike the US Fed Funds rate by 25 basis points, to a range of 2% – 2.25%. In addition, some analysts are anticipating a higher economic outlook to be shared in the press conference, that will come after that rate announcement.

The Fed has broadly suggested that the year could end with four rate hikes – one per quarter – with the fourth likely to come in December.

While the pace of hikes is good news for the US as it underscores the strength of the economy, there are concerns that a rate hike could lead to a volatile day for US stocks.

Stock movers

While the broader European indices aren’t hugely changed from the open, there have still been some interesting individual movers.

Santander shares are 0.31% higher at €4.49, after the Spanish bank announced that the current head of Investment Banking at UBS, will become the new Santander Group CEO from January 2019. Andrea Orcel is a well-known adviser to the Botin family who controls Santander.

Ryanair shares, meanwhile, are lower, after the budget Irish airline confirmed it had cancelled 190 Friday flights amid industrial action among some of its European-based cabin crew.

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