Europe open: Equities edge higher as investors look to FOMC rate announcement

Stocks in Europe edged higher in early trade as investors sifted through a batch of corporate results ahead of the Federal Open Market Committee rate decision, which is due after the European close.

At 0850 GMT, the benchmark Stoxx Europe 600 index was up 0.3%, while Germany’s DAX and France’s CAC 40 were 0.5% higher.

“Even as US interest rates are likely to stay at current levels for now until at least the next meeting in December, traders are hoping to get a clear indication if a rate rise for 2015 is still on the cards,” said Markus Huber, senior analyst at Peregrine & Black.

“Plenty of disappointing economic data as of late plus slowing growth in China have many analysts doubting not only if the US economy is strong enough to withstand a rate rise but also if the slowdown manifesting itself in recent weeks might worsen going into 2016. While there are still plenty of US earnings reports due out today the FOMC is likely to take limelight.”

Shares in Lloyds Bank fell sharply after it reported a decline in third-quarter underlying profit as it was hit by a further charge for insurance mis-selling.

Barclays was a little weaker as the bank confirmed the appointment of former JPMorgan investment banking head Jes Staley as its new chief executive.

Clothing retailer Next fell despite posting a 6% increase in third-quarter sales and nudging up its profit guidance for the year.

Chilean copper producer Antofagasta was firmly in the red after cutting its production target for this year again as it reported fairly stable output for the third quarter compared with the second.

BT Group was a high riser after the company’s £12.5bn acquisition of the EE mobile network was provisionally approved by UK competition officials.

Shares in Volkswagen advanced even though the German car maker posted an operating loss of €3.84bn in the third quarter, while Heineken rallied after its third-quarter results beat expectations.

Earlier, data from market research group GfK revealed that German consumer sentiment is set to weaken for the third month in a row in November as the migrant crisis takes its toll.

GfK said the forward-looking consumer sentiment index is expected to fall to 9.4 points from 9.6 in October.