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AUTOS STOCKS PROP UP THE STOXX 600 (0853 GMT)
European STOXX 600 index is just below the floating line
with autos stocks still on the rise after yesterday’s jump,
while commodities related stocks are in negative territory.
More good news is boosting the autos stock index,
which is up 1.4%, hitting a fresh two-year high.
Shares in BMW are up 4.4% after the company said
it expects a significant year-on-year increase in group pretax
profit in 2021.
Volkswagen’s ambitious expansion plans in electric driving
are also boosting the sector. Its shares are rising 2.3%.
Basic materials and oil and gas are among the
worst performers after their recent rally.
The STOXX 600 index is down 0.2%.
Financial markets across the globe are on hold ahead of the
Fed policy meeting outcome, which is expected to give clues
about next central bank’s moves on interest rates.
Eyes also on this week's first high-level, in-person contact
between Beijing and Washington since U.S. President Joe Biden
took office.
(Stefano Rebaudo)
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WHAT'S THE (DOT) PLOT, CHAIR POWELL? (0858 GMT)
It's Federal Reserve day and market focus is on the central
bank's rate-hike projections for 2023 in the so-called "dot
plot."
Some economists expect this to show the Fed now expects one
rate hike for 2023 versus none in December. An unchanged median
dot for 2023 could be interpreted as the Fed pushing back
against higher bond yields and markets' pricing of rate hikes.
The Fed will deliver its statement and economic forecasts at
1800 GMT, followed with a news briefing. Until then, barring
unforeseen events, markets will likely stay calm. Ten-year U.S.
yields are just off 13-month highs, the dollar index
is little changed and equity futures are a touch lower
.
The tone across world stocks is cautious too, with Asian
stocks tracking Wall Street's Tuesday fall and European markets
too set to open softer.
In the euro zone, it's the final day of voting in the Dutch
national election -- the first major general election in the EU
since the pandemic began.
Prime Minister Mark Rutte's VVD Party is expected to secure
a fourth term, but there is a risk markets are not adequately
pricing gains at the ballot for anti-establishment forces.
Some good news for AstraZeneca as Australia's
pharmaceutical regulator said the rollout of the company's
COVID-19 vaccine would continue, despite many European nations
pausing vaccinations to investigate reported side-effects.
The EU regulator will release findings on Thursday.
Elsewhere, Credit Agricole Italia has secured a
green light from European Central Bank supervisors for its
planned takeover bid of third-tier Italian lender Credito
Valtellinese .
Key developments that should provide more direction to markets
on Wednesday:
- Fed monetary policy decision and news conference.
- German, UK German new car registration data.
- US housing starts data due.
- Corporates: BMW said it expects a significant year-on-year
increase in pretax profit; Raiffeisen Bank aims to distribute
20%-50% of consolidated net profits; retail investment platform
Hargreaves Lansdown 2021 profit to beat expectations.
- Italy's biggest insurer Generali is studying an
acquisition in Russia worth nearly 2 billion euros ($2.4
billion), according to a media report.
(Dhara Ranasinghe)
*****
ON HOLD BEFORE THE FED (0628 GMT)
European stock futures are broadly unchanged along with
their U.S. peers as financial markets across the globe are on
hold before the U.S. Federal Reserve policy meeting outcome.
Investors are waiting for cues about central bank’s future
moves on interest rates after a jump in government bond yields
triggered by expectations of stronger than expected economic
growth and inflation.
Market will be closely watching also the first high-level
in-person contact between Beijing and Washington since U.S.
president Joe Biden took office. The meeting among Chinese and
U.S. officials will take place in Alaska on March 18 and 19.
(Stefano Rebaudo)
*****
