European stock markets are anticipated to open slightly higher on Wednesday, as investors focus on the forthcoming monetary policy announcement from the Federal Reserve scheduled for later today. The consensus suggests that the U.S. central bank will maintain the current interest rates. However, traders will scrutinize the accompanying statement for any indications regarding future rate directions.
In the midst of considerable uncertainty surrounding the economic policies under the Trump administration, it seems likely that reductions in interest rates may be postponed for an extended period, with the earliest possibility for a rate cut anticipated in the first half of the year.
Attention is also directed towards the European Central Bank's rate decision. Unlike the Fed, the ECB is expected to decrease rates by 25 basis points on Thursday.
In terms of corporate earnings, U.S. tech giant Microsoft is slated to release its quarterly earnings today, followed by Apple’s earnings announcement on Thursday.
Across Asian markets, shares in Japan, Australia, and New Zealand experienced gains, while most other markets remained closed due to the Lunar New Year holidays. The Australian dollar declined as weak inflation data fueled speculations of a potential interest rate cut by the Reserve Bank of Australia.
Gold prices remained stable, maintaining a position above $2,760 per ounce, as the U.S. dollar continued to demonstrate strength. Meanwhile, oil prices saw a slight decline as fears of supply disruptions from Libya eased, and the American Petroleum Institute reported a smaller-than-anticipated increase in U.S. crude oil inventories for the week.
On the U.S. front, stock markets closed in positive territory overnight, showing signs of recovery after a tech sector downturn on the previous day triggered by DeepSeek's unexpected emergence in the AI sector. Economic reports revealed a 2.2 percent decline in durable goods orders for December, while consumer confidence fell for the second consecutive month in January.
The technology-centric Nasdaq Composite index soared 2 percent, the S&P 500 rose by 0.9 percent, and the Dow gained 0.3 percent as attention shifted towards upcoming major tech earnings and the Federal Reserve meeting.
European equities reached new heights on Tuesday as global markets rebounded from a tech-driven selloff. The pan-European STOXX 600 index increased by 0.4 percent. Germany's DAX index advanced by 0.7 percent, the U.K.'s FTSE 100 climbed 0.4 percent, while France's CAC 40 registered a slight decline of 0.1 percent.
