Europe Factors to Watch-Shares set to inch up; eyes on Fed

Wed Jun 18, 2014 2:24am EDT

PARIS, June 18 (Reuters) - European stocks were set to inch higher on
Wednesday, mirroring gains on Wall Street, although the rise was seen limited as
investors waited on the sidelines for the U.S. Federal Reserve to conclude its
two-day policy meeting.
    At 0617 GMT, futures for Euro STOXX 50, for UK's FTSE 100,
for Germany's DAX and for France's CAC were up 0.1-0.3 percent.
    The Fed is widely expected to cut another $10 billion from its monthly bond
purchases, while investors will be watching for any comments on when the Fed
would begin to raise interest rates and its outlook for the economy.
 
    Data released on Tuesday showed a surprisingly high reading for U.S.
inflation, which sparked speculation of a hawkish tilt to the Fed's policy
outlook.
    "The rise in inflation could well give the Fed problems though given its
dual mandate, and irrespective of how well the economy is growing if
unemployment continues to drift lower, rate hikes could well come sooner,
especially if inflation continues to tick up," Michael Hewson, chief market
analyst at CMC Markets, wrote in a note.
    Investors were also cautious as violence in Iraq continued, keeping Brent
crude prices above $113 per barrel. Heavy fighting shut the country's biggest
refinery and led to the withdrawal of staff by foreign oil firms, fearing
Islamic militants from the north could strike at major oilfields concentrated in
the south despite moves by the Iraqi government to tighten security.
 
    Shares in Hennes & Mauritz will be in focus after the world's
second biggest fashion retailer reported second-quarter profits right in line
with analyst forecasts and said sales in June had gotten off to a good start.
 
      
    Europe bourses in 2014: (link.reuters.com/pad95v)
    Asset performance in 2014: (link.reuters.com/rav46v)
------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0618 GMT: 
                                         LAST  PCT CHG  NET CHG
 S&P 500                             1,941.99   0.22 %     4.21
 NIKKEI                               15115.8   0.93 %   139.83
 MSCI ASIA EX-JP                       488.45  -0.25 %    -1.24
 EUR/USD                               1.3543  -0.01 %  -0.0002
 USD/JPY                               102.24    0.1 %   0.1000
 10-YR US TSY YLD                       2.646       --    -0.01
 10-YR BUND YLD                         1.402       --     0.00
 SPOT GOLD                          $1,268.04  -0.25 %   -$3.15
 US CRUDE                             $106.56   0.19 %     0.20
 
  > GLOBAL MARKETS-DOLLAR FIRM, INFLATION ADDS TO FED RISK 
  > US STOCKS-BANKS LEAD WALL ST HIGHER; CYCLICALS RALLY 
  > NIKKEI EDGES UP ON WALL ST, WEAK YEN 
  > FOREX-DOLLAR UNDERPINNED BY INFLATION DATA, ALL EYES ON FED 
  > GOLD SLIPS AHEAD OF FED ON STRONGER DOLLAR, FUND OUTFLOWS 
  > COPPER EDGES TO NEAR 2-WEEK PEAK ON HOPES FOR CHINA SUPPORT 
  > BRENT HOLDS ABOVE $113 AMID IRAQ VIOLENCE 
    
    COMPANY NEWS:
    
    HENNES & MAURITZ 
    The world's second biggest fashion retailer reported second-quarter profits
right in line with analyst forecasts and said sales in June had gotten off to a
good start. 

    SIEMENS, ALSTOM 
    The French government raised the stakes in the battle for engineering group
Alstom on Tuesday, telling rival suitors General Electric (GE) and Siemens to
come up with better offers. 
    The French government is willing to take a stake of 10 percent or more in
Alstom alongside Mitsubishi Heavy Industries (MHI) as part of the
Japanese firm's joint offer with Siemens, an Alstom union representative told
Reuters on Tuesday.
    
    VP BANK 
    The Swiss lender said on Wednesday that net profit for the first half of
this year would be "significantly lower" than the prior-year period, citing
declining interest rates. 
    
    NOVARTIS 
    Swiss drugmaker Novartis said its recent business overhaul should boost
profitability and speed up growth as it focuses on businesses with scale and
higher margins. In a statement published ahead of its investor day in Basel on
Wednesday, Novartis said its new structure would have added an extra 250 basis
points to last year's core operating income margin. 
    
    BANCO POPOLARE 
    The bank said on Tuesday rating agency Standard & Poor's had raised the
rating of its stand-alone credit profile from "B" to "B+", while the long and
short-term ratings of the lender and of its subsidiaries Credito Bergamasco and
Banca Aletti were affirmed at "BB-/B", with negative outlook.
    
    SANTANDER, BBVA, BARCLAYS 
    Santander Totta, the Portuguese offshoot of Spain's Santander, is eyeing the
local commercial loan books of Barclays and BBVA, chief
executive Antonio Vieira Monteiro told Reuters on Tuesday.
    
    ZODIAC 
    The French aircraft cabin and systems maker said that nine-month revenue
rose 7.3 percent, helped by growth in air travel and higher plane deliveries.
 
    
    EDF 
    France is set to unveil a much-delayed energy transition bill on Wednesday
that will avoid making tough choices on its dominant nuclear energy sector,
instead focusing on measures to cut red tape currently stifling renewables and
boost energy savings. 
    
    

 (Reporting by Blaise Robinson; Editing by Francesco Canepa and Atul Prakash)
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.