Investing.com - European stock markets were sharply lower on Wednesday, as market sentiment weakened after the Federal Reserve held back from taking any new steps to stimulate growth.
During European morning trade, the EURO STOXX 50 retreated 0.68%, France’s CAC 40 declined 1%, while Germany’s DAX 30 fell 0.73%.
At its final policy meeting of the year on Tuesday, the Fed noted modest improvement in the U.S. economy but added that market turbulence in the face of Europe's debt woes posed a big risk.
Fed officials reiterated that short-term interest rates are likely to stay close to zero until mid-2013 at least.
Meanwhile, sentiment was also hit after German Chancellor Angela Merkel reiterated her opposition to increasing the EUR500 billion lending limit for the permanent euro zone bailout fund, the European Stability Mechanism.
Financial stocks were mixed as shares in Societe General tumbled 2.15% and BNP Paribas lost 1%, while German lender inched up 0.04%.
Meanwhile, Italian lenders posted strong gains with Intesa Sanpaolo jumping 1.08% and Unicredit climbing 0.69%, as the country’s Treasury prepared to auction as much as EUR3 billion of debt maturing in 2016 later in the day. Italian borrowing costs rose back above 7% ahead of the sale.
Elsewhere, Spanish group Inditex surged 3.74% after the world’s largest clothing retailer posted nine-month net income that climbed 7.3% as the company added stores in Asia and expanded its e-commerce range for Zara and other brands.
In London, commodity-heavy FTSE 100 retreated 0.50%, led by sharp losses in mining stocks.
Mining giants Rio Tinto and Bhp Billiton tumbled 1.29% and 1.34% respectively, while Anglo American plunged 1.31%.
Copper producers Xstrata and Kazakhmys saw shares decline 0.32% and 0.61%.
The financial sector was also broadly lower as shares in HSBC Holdings fell 0.89% and Barclays retreated 0.82%, while the Royal Bank of Scotland and Lloyds Banking lost 0.83% and 0.51% respectively.
Meanwhile, IT company Logica plummeted 14.25% after reducing its revenue-growth forecast and accelerating a restructuring that will lead to charges of GBP80 million this year and 1,300 job losses.
In the U.S., equity markets pointed to a moderately higher open. The Dow Jones Industrial Average futures pointed to a rise of 0.28%, S&P 500 futures signaled a 0.34% increase, while the Nasdaq 100 futures indicated a 0.20% gain.
Later in the day, the euro zone was to release official data on industrial production, while the U.S. was to produce official data on import prices and crude oil stockpiles.
During European morning trade, the EURO STOXX 50 retreated 0.68%, France’s CAC 40 declined 1%, while Germany’s DAX 30 fell 0.73%.
At its final policy meeting of the year on Tuesday, the Fed noted modest improvement in the U.S. economy but added that market turbulence in the face of Europe's debt woes posed a big risk.
Fed officials reiterated that short-term interest rates are likely to stay close to zero until mid-2013 at least.
Meanwhile, sentiment was also hit after German Chancellor Angela Merkel reiterated her opposition to increasing the EUR500 billion lending limit for the permanent euro zone bailout fund, the European Stability Mechanism.
Financial stocks were mixed as shares in Societe General tumbled 2.15% and BNP Paribas lost 1%, while German lender inched up 0.04%.
Meanwhile, Italian lenders posted strong gains with Intesa Sanpaolo jumping 1.08% and Unicredit climbing 0.69%, as the country’s Treasury prepared to auction as much as EUR3 billion of debt maturing in 2016 later in the day. Italian borrowing costs rose back above 7% ahead of the sale.
Elsewhere, Spanish group Inditex surged 3.74% after the world’s largest clothing retailer posted nine-month net income that climbed 7.3% as the company added stores in Asia and expanded its e-commerce range for Zara and other brands.
In London, commodity-heavy FTSE 100 retreated 0.50%, led by sharp losses in mining stocks.
Mining giants Rio Tinto and Bhp Billiton tumbled 1.29% and 1.34% respectively, while Anglo American plunged 1.31%.
Copper producers Xstrata and Kazakhmys saw shares decline 0.32% and 0.61%.
The financial sector was also broadly lower as shares in HSBC Holdings fell 0.89% and Barclays retreated 0.82%, while the Royal Bank of Scotland and Lloyds Banking lost 0.83% and 0.51% respectively.
Meanwhile, IT company Logica plummeted 14.25% after reducing its revenue-growth forecast and accelerating a restructuring that will lead to charges of GBP80 million this year and 1,300 job losses.
In the U.S., equity markets pointed to a moderately higher open. The Dow Jones Industrial Average futures pointed to a rise of 0.28%, S&P 500 futures signaled a 0.34% increase, while the Nasdaq 100 futures indicated a 0.20% gain.
Later in the day, the euro zone was to release official data on industrial production, while the U.S. was to produce official data on import prices and crude oil stockpiles.