European equity markets experienced gains on Wednesday, with the STOXX 50 increasing by 0.3% to reach 5,390 and the broader STOXX 600 rising by 0.1%. Investors were keenly anticipating the policy decision from the US Federal Reserve. It is largely anticipated that the Fed will proceed with its first rate cut in nine months, reducing rates by a minimum of 25 basis points as it considers a decelerating labor market coupled with inflation driven by tariffs. Additionally, market participants are expected to scrutinize the Fed’s quarterly "dot plot" projections for insights into future policy direction.
Regarding economic data, the UK reported that inflation remained steady at 3.8% in August, unchanged from July, hovering near the highs last seen in January 2024. This comes just one day ahead of the Bank of England’s own policy announcement.
In company-related developments, PostNL saw its shares surge by 7% following the reveal of a new strategic direction during its Capital Markets Day. The company announced plans to bifurcate its Parcels segment into two separate divisions—titled E-commerce and Platforms—beginning in 2026. Additionally, Novo Nordisk's shares climbed by 1.8% after Berenberg upgraded its rating on the Danish pharmaceutical firm from "Hold" to "Buy".
