European stocks struggled on Wednesday, alongside U.S. equity futures as investors awaited the outcome of the Federal Open Market Committee meeting and ahead of that, a Bank of England policy decision.
Chip stocks were under pressure after a Samsung Electronics executive warned of problems with global shortages.
The Stoxx Europe 600 index
slipped 0.3% after a 0.9% gain on Tuesday, the biggest one-day percentage gain since March 8. A loss would mark the first in three sessions. The German DAX
and French CAC 40
were flat, while the FTSE 100
fell 0.4%. The euro
was steady, while the British pound
was firmer against the dollar.
U.S. stock futures
were mixed, with Nasdaq-100 futures
under pressure. The Dow industrials
and S&P 500
ended lower on Tuesday, a day after posting records, while the Nasdaq Composite
managed a modest gain. Investors are expecting no changes in Fed policy, but will be paying close attention to its projections regarding the U.S. economy and interest rates.
Fed Chairman Jerome Powell’s news conference will also be a highlight as pressure remains on the bond market. The yield on the 10-year Treasury
was up 2 basis points to 1.632%.
Elsewhere, no change is expected from the Bank of England’s Monetary Policy Committee, which is expected to keep its key rate steady at 0.1% and maintain the ceiling of its ongoing bond-buying program at £895 billion ($1.2 trillion). Gilt yields
hovered at 0.79%, but began the year at around 0.2%.
New car sales in the European Union fell 19% on an annual basis in February, as economic uncertainty and measures to stop the spread of COVID-19 weighed on demand, the European Automobile Manufacturers’ Association said.
shares were among the biggest gainers, up 4% after the German luxury car maker said group pretax profit should be significantly higher than in 2020, as it forecast projected earnings before interest and taxes margin for the automotive unit to come in at between 6% and 8%.
Shares of STMicroelectronics
fell over 1%, and those of ASM International
dropped 0.6%. Chip-related companies tracked losses in Asia for companies such as Taiwan Semiconductor which fell 1% and Samsung Electronics, which dropped 0.6%.
Those losses came after a warning over chip shortages that have hit the global auto sector and could spread to technology.
“There’s a serious imbalance of supply and demand in the IT sector globally…It is hard to say the shortage issue has been solved 100%,” co-Chief Executive Officer Koh Dong-jin said at a shareholder meeting, according to the Financial Times.