LONDON, Sept 17 (Reuters): European shares rose in cautious trading on Wednesday on expectations that the US Federal Reserve may signal after a meeting later in the day that it will continue to keep interest rates low for a longer period.
However, British equities underperformed, as investors remained jittery ahead of Scotland's referendum on independence on Thursday. Three opinion polls showed Scottish supporters of staying in the United Kingdom were 4 percentage points ahead of secessionists.
Britain's blue-chip FTSE 100 index was up 0.2 per cent, against a 0.6 per cent gain for the FTSEurofirst 300 index of top European shares to 1,386.66 points by 1035 GMT. The European index hit a two-week low in the previous day.
Sentiment on European markets was lifted after US stocks turned positive on Tuesday on a report in the Wall Street Journal, which indicated the Fed could be less hawkish than markets have been expecting, traders said.
"The latest figures on consumer confidence, retail sales and unemployment rate all point towards a change in tone from the Fed," FXCM analyst Vincent Ganne said.
"The market's recent move has the shape of a 'buy the rumour, sell the news' pattern, so I wouldn't be surprised to see stocks moving lower following the Fed. The end of the central bank's support is the main risk facing equity markets at the moment."
The US central bank began its two-day policy meeting on Tuesday, and while it has said it doesn't expect to raise interest rates until 2015, recent strong economic data has led Fed officials to acknowledge they may need to move sooner than they previously anticipated.
European shares gain on hope of less hawkish Fed
FE Team | Published: September 18, 2014 00:00:00 | Updated: November 30, 2026 06:01:00
Share if you like