European markets opened with a positive sentiment on Wednesday, with the German DAX index demonstrating an upward trend. Shortly after 9:30 AM local time, the benchmark index was recorded at approximately 23,450 points, representing a gain of 0.5 percent compared to the previous day’s closing level.
Leading the gains within the DAX were shares of SAP, Rheinmetall and MTU, while Zalando, BASF and Siemens experienced declines.
Attention is currently focused on the upcoming interest rate decision by the U.S. Federal Reserve, scheduled for later in the day. Market analysts suggest the decision could significantly influence trading activity. “It’s a Federal Reserve day – one of those trading sessions where the real developments often unfold later” noted Thomas Altmann of QC Partners.
While a rate cut is widely anticipated, any deviation from a 25 basis point reduction would be considered a substantial surprise. However, Altmann emphasizes that the market’s reaction will be largely determined by the Fed’s forward guidance, particularly regarding the future path of interest rates. Current market expectations incorporate two further rate cuts this year and three in the next. A failure to meet these expectations could potentially expose the market to losses.
The Euro was slightly weaker against the US Dollar this Wednesday morning, trading at $1.1843 and a dollar was correspondingly valued at €0.8444.
Meanwhile, oil prices have seen a downward trend, with a barrel of Brent crude futures falling to $68.30 around 9:00 AM local time – a decrease of 17 cents, or 0.3 percent, compared to the closing level of the previous trading day.
