By Peter Nurse
Investing.com - European stock markets are seen opening largely lower Wednesday, amid caution ahead of the Federal Reserve’s last policy-setting meeting of the year.
At 2:05 AM ET (0705 GMT), the DAX futures contract in Germany traded 0.1% lower, the FTSE 100 futures contract in the U.K. fell 0.3%, while the CAC 40 futures in France rose 0.4%.
U.K. and European Union continue to race against the clock to try and reach a post-Brexit trade deal. Chief EU Brexit negotiator Michel Barnier has said that he sees a “narrow path” towards a deal, if both sides resolve their differences.
The two sides will have only days to ratify any trade agreement, even if they manage to reach one this week.
Meanwhile, Italy announced plans to impose new restrictions during the holiday season to try and avoid a third devastating wave of the coronavirus, joining the likes of Germany, the Netherlands and the U.K. in tightening restrictive measures during the festive period.
That said, some investors were optimistic about the market’s long-term prospects.
The United States moved closer to authorizing the emergency use of Moderna’s Covid-19 vaccine, adding another string to that particular bow, while its lawmakers continue to discuss the possibility of another stimulus package to help support the economy during this surge in Covid-19 cases.
Additionally, the Federal Reserve concludes its final policy-setting meeting of the year later Wednesday. Faced with an economy slowing as the coronavirus outbreak worsens, the central bank has to consider whether to alter its asset purchase program to provide more support for growth.
In corporate news, Alstom (PA:ALSO) will be in focus after the French manufacturer of railway stock said late Tuesday that it has won a contract for a third metro line in the South of France, for a value of up to 713 million euros ($867 million).
The main data release in Europe will be the flash purchasing manager’s index data from the euro zone for December.
Oil prices slipped back Wednesday following a surprise increase in U.S. inventories, putting the focus back on the impact on demand, given the tighter lockdowns caused by the surge in Covid-19 cases.
Crude stocks grew by almost 2 million barrels in the week to Dec. 11, according to industry group API, compared with the 3.5-million-barrel draw expected. Official government data are scheduled for later Wednesday.
U.S. crude futures traded 0.4% lower at $47.45 a barrel, while the international benchmark Brent contract fell 0.4% to $50.56.
Elsewhere, gold futures rose 0.2% to $1,859.80/oz, while EUR/USD traded 0.1% higher at 1.2167.