European markets open mixed as investors await Fed decision
2024.12.18 03:11
Investing.com — European markets traded in mixed fashion on Wednesday as investors await key developments from the U.S. Federal Reserve.
As of 3:13 ET (8:13 GMT), index was down 0.1%, 40 remained unchanged, and the U.K.’s edged 0.2% higher.
The Fed is widely expected to announce a 0.25% interest rate cut, additionally, market participants are keenly monitoring the Summary of Economic Projections and Fed Chair Jerome Powell’s remarks for signals about the direction of monetary policy in the coming months.
U.K. inflation dampens rate cut hopes
Annual inflation in the U.K. rose to 2.6% in November, up from 2.3% in October, aligning with market expectations.
This increase has dimmed the prospects of a rate cut by the Bank of England during its meeting on Thursday.
As of early Wednesday, yields on the U.K.’s 10-year Gilts were largely unchanged at 4.519%, while the British pound softened slightly, slipping 0.07% to trade around $1.2700 against the U.S. dollar.
UniCredit increases potential stake in Commerzbank
UniCredit said on Wednesday that it has expanded its potential stake in Commerzbank (ETR:) to 28% through additional derivatives, fueling speculation about a possible acquisition of the German lender.
UniCredit, Italy’s second-largest bank, revealed that 9.5% of its holding in Commerzbank is a direct stake, while the remaining 18.5% has been secured through derivative instruments.
The bank has also sought approval from the European Central Bank to increase its stake in Commerzbank to as much as 29.9%. At the same time, UniCredit is pursuing a bid for its domestic competitor, Banco BPM.
Oil prices steady amid market caution
Oil markets exhibited limited movement on Wednesday as traders held back from making significant bets ahead of more clarity on global interest rates.
At 3:13 ET, the steadied at $70.05 a barrel, while rose 0.5% to $73.57 a barrel.
While crude prices saw gains last week amid expectations of tighter supply from potential U.S. sanctions on Russian oil, this momentum has stalled. Concerns over waning demand in China and a potential oversupply in the coming year have tempered the market’s outlook.
