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European stocks rise ahead of Fed

FXStreet (Córdoba) - European stocks advanced in early trade Wednesday for the first time in nine days, recovering from a 2-week low, as investors track Wall Street gains ahead of the Federal Reserve monetary policy decision.

The Stoxx Europe 600 rose 0.48% to 344.50 in early trade. The index hasn’t had a positive close since the European Central Bank’s decision to cut all three rates on September 4. As for country-specific indexes, the UK FTSE gained 0.17%. The Germany’s DAX 30 climbed 0.50% while the France’s CAC 40 advanced 0.61%. Spain’s Ibex 35 rose 0.46% while Italy’s FTSE MIB was up 0.68%.

Stocks are tracking Wall Street’s rally as investors scale back expectations of a Fed’s hawkish shift after a WSJ report yesterday suggested the central bank will keep the low rates for a considerable time unchanged.

The Federal Reserve will announce its monetary policy decision at 18:00 GMT and Chair Janet Yellen will hold a press conference 30 minutes later, after the close of European trading.

In the FX market, the dollar traded mixed within recent ranges as investors refrain from taking big positions ahead of the FOMC statement. GBP/USD spiked to a high of 1.6335 and filled last week’s gap after data showed UK unemployment rate edged lower to 6.2% in the three months to July, while BoE minutes showed two members voted to hike rates in last meeting.

In terms of economic releases, watch for US consumer price index for August and the Federal Reserve decision followed by Yellen’s speech at 18:30 GMT.

As for commodities, gold was little changed at $1,235 an ounce, while crude was flat at $94.88 a barrel.

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