BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks may struggle for a clear direction on Wednesday amid an impasse in U.S. economic stimulus negotiations and ahead of Federal Reserve's policy outcome.
U.S. President Donald Trump said on Tuesday he did not support everything in a $1 trillion Senate Republican coronavirus relief proposal but would not elaborate on what he didn't not like.
No major changes are expected when the Fed releases its policy statement later in the day. Traders may look to the accompanying statement for clues about future plans to provide additional economic stimulus.
Asian markets are trading mixed after Fitch Ratings lowered the outlook on Japan's sovereign rating from stable to negative while keeping the rating itself unchanged.
Worsening coronavirus outbreaks in Florida and Texas also added to the caution.
The dollar languished near two-year lows while gold hovered near record highs. Oil prices rose in Asian deals after industry data showed that crude inventories in the United States increased against expectations.
Mortgage approval data from the U.K. and consumer confidence figures from France are due later in the session, headlining a light day for the European economic news.
U.S. stocks ended lower overnight as earnings from 3M and McDonald's missed estimates and data showed U.S. consumer confidence ebbed in July amid a flare-up in Covid-19 infections across the country. A delay over the second stimulus package also dented sentiment as the Fed meeting got underway.
The Dow Jones Industrial Average shed 0.8 percent, the tech-heavy Nasdaq Composite fell 1.3 percent and the S&P 500 declined 0.7 percent.
European stocks ended mixed on Tuesday as investors reacted to news indicating some progress on fresh stimulus efforts in the U.S., and reports about lockdowns being reimposed in several countries. The pan European Stoxx 600 gained 0.4 percent.
The German DAX finished marginally lower and France's CAC 40 index dipped 0.2 percent, while the U.K.'s FTSE 100 rose 0.4 percent on reports that the U.K government will extend the Help to Buy property support scheme beyond its December deadline.
Copyright RTT News/dpa-AFX
© 2020 AFX News
