European Factors to Watch-Flat start eyed ahead of Fed

miércoles 19 de marzo de 2014 03:32 GYT
 

(Adds futures, quotes, company news)

LONDON, March 19 (Reuters) - European stocks were seen pausing after two sessions of gains on Wednesday as traders held fire ahead of a policy update from the U.S. Federal Reserve, whose ultra-easy monetary stance has been a key driver behind a sharp equity rally over the past 1-1/2 years.

At 0728 GMT, futures for the Euro STOXX 50, Britain's FTSE 100 , Germany's DAX and France's CAC were between 0.1 percent lower and 0.1 percent higher. The cash indexes are up by between 1.2 percent and 2.3 percent so far this week.

The Fed is set to further trim its bond-buying stimulus and could rewrite its guidance on when it might eventually raise interest rates, with some expecting chair Janet Yellen to scrap a numerical target on unemployment and adopt a more flexible stance.

"The Fed have detailed a number of changes recently, so we shouldn't be surprised by most of the big changes that should be announced," Chris Weston, chief market strategist at IG, said in a trading note. "The question is how radical are the changes are? Given price action of late, the market is positioned for a dovish stance."

The Euro STOXX 50 rose 0.8 percent on Tuesday after comments from Russian President Vladimir Putin eased concerns that tensions between Moscow and the West over Ukraine would escalate.

The index has been bouncing back from "oversold" territory after shedding nearly three percent last week on concerns about the Ukrainian crisis and jitters in the Chinese credit market.

The Euro STOXX 50 has risen roughly 35 percent since the Fed announced its monetary stimulus programme in September 2012, also helped by some signs of economic recovery in the euro zone.

"We're going to have a technical rally and just a glimpse of where we were at the high, so 6,700 for the FTSE and just over 3,100 for the Euro STOXX 50 and then we're going to ease back again," Justin Haque, a pan-European broker at HB Capital Markets, said.   Continuación...