In European Equity Markets stocks fell on Wednesday, hit by a fall in Swiss drugmaker Novartis and German chemicals company BASF after their weak earnings updates. Royal Bank of Scotland also fell after the bank warned its profits would be hit by a pension charge and U.S. litigation provisions. The pan-European FTSEurofirst 300 index was down by 0.5 percent to 1,329.53 points, while the euro zone’s bluechip Euro STOXX 50 index fell 0.5 percent. Novartis fell 4.1 percent after its fourth-quarter core net income missed expectations, while BASF declined by 3.3 percent after issuing a profit warning. In Scandinavia, TDC fell 9.8 percent after the Danish telecom operator scrapped its dividend following a deterioration in its financial results.
In Currency Markets the dollar edged lower against a basket of major currencies on Wednesday as oil declined and investors awaited the Federal Reserve’s statement for clues on whether bets on a single U.S. interest rate rise in 2016 are justified. The euro rose above $1.09 to its highest in six days but quickly returned those gains to be flat at $1.0874. With markets largely in waitandsee mode before the Fed, sterling was the biggest mover, falling 0.7 percent against the dollar as fears of a U.K. exit from the euro zone grew. The dollar added 0.1 percent versus the yen to 118.53. The Australian dollar hit a three-week high after a measure of domestic inflation came in slightly higher than expected. It rose around 0.5 percent against its U.S. counterpart.
In Commodities Markets oil futures rallied back above $32 a barrel on Wednesday, after U.S. data showed a jump in weekly demand for products such as heating oil when a cold front hit the country, although analysts said the rise in prices may not last long. Data from the U.S. EIA showed inventories of distillates such as heating oil fell by more than 4 million barrels, trumping expectations for a rise of nearly 2 million. Brent crude was last up 10 cents at $31.90 a barrel, having hit a session low of $30.83. U.S. crude futures were down 21 cents at $31.24 a barrel, having previously fallen to a session low of $30.14. Traditional safe-haven gold retreated from a 12-week high set Tuesday, last down $4.01 or 0.36 percent, at $1,116.16 an ounce.
In US Equity Markets stocks fell on Wednesday after Apple and Boeing reported disappointing forecasts and investors awaited the Federal Reserve’s statement on monetary policy. Apple’s shares were down 5.3 percent after the company also reported its slowest-ever rise in iPhone shipments on Tuesday. Boeing sank 9.5 percent, its biggest single-day fall since October 2001, and was the biggest negative influence on the Dow. TripAdvisor, Priceline and Expedia were down 2.6-3.2 percent, after Goldman Sachs downgraded travelrelated stocks. The S&P 500 was down 0.59 percent, at 1,892.46 and the Nasdaq Composite index was down 1.14 percent, at 4,515.47. Seven of the 10 major S&P sectors were lower, led by the 1.7 percent fall in tech stocks.
In Bond Markets U.S. Treasury yields rose on Wednesday ahead of the release of the Federal Reserve’s latest policy statement and the U.S. government’s sale of $35 billion in new five-year debt. Benchmark 10-year notes were last down 9/32 in price to yield 2.03 percent, up from 2.00 percent late on Tuesday. The yields have fallen from 2.33 percent on Dec. 30. The Treasury will sell $35 billion in five-year notes on Wednesday, the second sale of $90 billion in new coupon-bearing debt this week. It will also auction $29 billion in seven-year notes on Thursday.