Europe close: Stocks move lower ahead of US Fed minutes

European stocks fell on Wednesday as investors awaited the release of the latest minutes from the Federal Reserve against the backdrop of somewhat hawkish remarks from two US central bank officials during the previous session.

The benchmark Stoxx Europe 600 index slipped 0.83%, Germany’s DAX was 1.3% weaker and France’s CAC 40 was down 0.96%.

At the same time, oil prices gained following the release of a weekly update on the level of crude inventories in the States. West Texas Intermediate was up 0.021% to $46.59 a barrel and Brent crude was higher by 0.846% at $49.65.

Market participants will be turning their attention to the Federal Reserve minutes as they look for clues on the timing of a rate hike, particularly after New York Fed President William Dudley hinted on Tuesday that a move was possible as early as September. The minutes were due at 1900 BST.

Dudley told Fox Business Network: "We're edging closer towards the point in time where it'll be appropriate to raise interest rates further.”

He added that a rate hike next month was “possible" at the policy meeting on 20-21 September.

"We have to see how the data falls and where we are in terms of the broad supports for the economy. I think the economy is in OK shape,” Dudley said.

Markus Huber, a trader at City of London Markets, said Dudley’s comments offered “a welcome excuse” for many traders to take some money off the table and cash in on the recent rally.

“In reality, however, this isn't the first time that the Fed is trying to prepare the markets for a rate hike and in the end rates were left at current levels for many months after. Also throughout the last few years there were always a couple of Fed members who were calling for rate hikes but in the end didn't really represent the overall opinion of the FOMC.

“But because of Dudley's comments today's release of the FOMC minutes will carry even more weight than it usually does and certainly will have the potential to be a decent market mover.”

In corporate news, Carlsberg was under pressure after the brewer’s half-year results fell short of expectations, although it maintained its outlook for the year.

Insurer Admiral was sharply lower amid concerns about the group’s Solvency II position, after it lifted its interim dividend by almost a quarter and posted a jump in first-half profits.

On the upside, ABN Amro racked up healthy gains following better-than-expected second-quarter results.

Aerospace and defence group Cobham rallied after announcing that chief executive officer Bob Murphy will step down from his role by the end of 2016 to pursue other opportunities and will be succeeded by David Lockwood no later than 1 January 2017.

FTSE 250 construction group Balfour Beatty surged after it reinstated its dividend as it reported a smaller loss for the half year ended 1 July.