Europe: Stocks drop at open, before Fed rate hike

EUROPEAN stock markets retreated on Wednesday (Sep 21) as traders expect the Federal Reserve (Fed) to announce another large hike in US interest rates to combat decades-high inflation.

London’s benchmark FTSE 100 index shed 0.2 per cent to 7,179.26 points.

In the eurozone, Frankfurt’s DAX index slid 1.1 per cent to 12,532.24 points and the Paris CAC 40 lost 0.9 per cent to 5,926.26.

“We certainly have a couple of tense hours before the Fed decision falls” at 1600 GMT, noted Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

Many economists are expecting a 3-quarter point rate hike for a third meeting in a row, while there is a chance the Fed could opt for a full point increase. AFP