European stocks close level before Fed outcome

Europe’s main stock markets were mainly flat on Wednesday, as investors waited for any fresh signals from the Federal Reserve on interest rates .

London’s benchmark FTSE 100 index ended up 0.81 percent to end the day at 6,453.87 points, while in Paris, the CAC 40 was nearly level, easing just 0.05 percent to 4,110.64 points.

Frankfurt’s DAX index edged up 0.16 percent to 9,082.81 points.

Dealers also pored over another batch of company earnings, while shares in Sanofi (NasdaqGM: GCVRZ – news) closed more than 4.5 percent down after the French drugs giant fired its chief executive.

The Dow moved further above 17,000 in early trade, while the Nasdaq fell as Facebook (NasdaqGS: FB – news) shares tumbled more than six percent on the social network’s heavy spending plan.

About 40 minutes into trade, the Dow Jones Industrial Average stood at 17,043.28, up 0.22 percent, while the broad-based S&P 500 gained 0.14 percent to 1,987.80 and the tech-rich Nasdaq Composite Index dropped 0.35 percent to 4,548.19.

Nasdaq member Facebook fell 6.3 percent after chief executive Mark Zuckerberg pledged to keep “investing aggressively” in growth, a statement that raised concerns about excessive spending. The company’s third-quarter net income soared to $806 million from $425 million last year.

The Fed ends a two-day policy meeting on Wednesday, with traders expecting the central bank to end the vast asset-purchase stimulus programme credited with propping up US growth after the 2008 financial crisis.

Economists and traders widely anticipate that the Federal Open Market Committee will use a post-meeting statement at around 1800 GMT to announce the end of the six-year-old “quantitative easing” (QE) scheme.

- ‘No rush to raise rates’ -

But traders are more interested in what policymakers have to say about interest rates.

The Fed is expected to stay the course on near-zero rates, after repeatedly saying the first rise would come “a considerable time” after the bond-buying stops.

“I suspect the Fed will be in no rush to raise interest rates as (Janet) Yellen won’t want to be remembered as the Fed chair that launched QE4,” said analyst David Madden of the IG Group (Other OTC: IGGHY – news) .

In foreign exchange deals, the euro nudged higher to $1.2753 from $1.2733 late in New York on Tuesday.

The European single currency rose to 79.03 British pence from 78.92 pence.

The British pound edged up to $1.6136 from $1.6135 on Tuesday.

On the London Bullion Market, the price of gold eased to $1,228 an ounce from $1,229.25 an ounce on Tuesday.

In share price movement, Sanofi stock was down 4.54 percent at 71.15 euros in mid-afternoon trade after losing more than 10 percent the day before over disappointing earnings.

On Wednesday, the company fired chief executive Christopher Viehbacher after a row over his management style.

Fiat Chrysler saw its shares jump 12.89 percent to 8.60 euros after it announced it is floating Ferrari, its sports and racing car business, on a US stock exchange and possibly in Europe.

Shares (Berlin: DI6.BE – news) in Total gained 1.98 percent to 46.39 euros as the company recovering from the recent death of its chief executive in a plane crash reported a profit fall in the third quarter on declining oil and gas production.

Christophe de Margerie died last week when his private jet crashed in Russia. He was largely credited with the group’s international expansion and had focused on raising production, in particular through operations in Russia.

Spanish bank BBVA slipped 4.07 percent to 8.82 euros despite announcing that its profits tripled in the third quarter.

In Milan, Banca Monte des Paschi (Milan: BMPS.MI – news) , still reeling from its failing grade from the European Central Bank’s stress test on Sunday, closed down 8.23 percent to 0.7305 euros.

European stocks close level before Fed outcome