Stoxx 600, FTSE, CAC, DAX, Fed rate cut

LONDON — European shares ended lower on Wednesday, although some stocks were supported by gains as investors awaited the conclusion of the US Federal Reserve meeting.

The pan-European Stoxx 600 ended 0.1% lower, with major indexes and sectors mixed.

United Kingdom FTSE 100 index closed trading up 0.6%, Italy FTSE MIB and that of Spain advanced by 0.3% IBEX 35which has performed well recently, ended the session up 0.4%.

Meanwhile, to Germany DAX fell by 0.6%, while that of France CAC 40 fell 0.2%.

The big event for the markets is today’s interest rate cut by the Fed, with the quarter-point cut seen as a done deal by traders. If the Federal Open Market Committee acts as expected, it will bring the federal funds rate to a range between 3.75%-4%.

What is less certain is whether Chairman Jerome Powell will take a dovish tone in his comments after the meeting.

After a potential cut this week, 84% of respondents see another cut in December, and 54% see a third in January. according to CNBC’s October Fed survey. A total of 100 basis points of rate cuts are forecast this year and next, bringing the funds rate down to 3.2% by the end of 2026.

Earnings also dominate market attention this week, with Alphabet, Meta Platforms and Microsoft plans to report after the U.S. close on Wednesday. Apple and Amazon publish the results on Thursday.

In Europe, in Germany Mercedes-Benz Group on Wednesday reported a 70 percent drop in operating profit for the third quarter, citing allegations of thousands of job cuts as it seeks to save 5 billion euros ($5.81 billion) by 2027. Earnings before interest and taxes (EBIT) came in at 750 million euros for the quarter, down sharply from 2.5 billion euros in the same period last year.

The luxury carmaker, like its peers in the European industry, is facing a perfect storm of challenges as strong Chinese demand and increased costs due to US tariffs take their toll. However, Mercedes-Benz Group shares ended Wednesday up 4.5%.

UBS shares ended down more than 1% after the Swiss banking giant reported net earnings of $2.5 billion in the third quarter, which topped analysts’ estimates of $1.85 billion, as revenue of $12.76 billion also beat expectations.

Santander reported a record nine-month profit, up 7.8% year-on-year, which the bank attributed to strong business results and efficiencies such as streamlining operations, fewer bad loans and credit risks and more customers. Its shares closed up 4.1% on Wednesday.

The firm’s revenue reached 15.3 billion euros in the third quarter, up 1 percent year-on-year but well short of analysts’ forecasts, according to data compiled by LSEG. However, its net operating income was slightly higher at 8.99 billion euros, an increase of 2% from last year’s quarter. It stuck closely to its 2025 guidance of €62 billion in revenue.

However, Santander’s British subsidiary delayed its results after a court ruling on Friday ruled it must disclose dealer commissions on car finance transactions as part of the fallout from the auto finance scandal.

Meanwhile, Deutsche Bank shares rose nearly 5% after it reported a better-than-expected net profit of 1.56 billion euros in the third quarter, compared with the 1.34 billion euros expected by analysts, according to LSEG. The figure represents a quarterly increase of 7%. The German bank said all four of its businesses – corporate banking, investment banking, private banking and asset management – were “advancing on their strategic plans”, putting it on track for the year. Its current guidance points to revenues of around €32 billion.

Adidas shares fell more than 10% after the preliminary results were confirmed.

elsewhere Nokia shares fell 4.3% on Wednesday as investors reacted to Tuesday’s news that the chip maker Nvidia acquires a $1 billion stake in the Finnish network firm, forming a strategic partnership to develop next-generation 6G cellular technology.

Trade tensions between the US and China appear to be easing ahead of President Donald Trump’s meeting with Chinese President Xi Jinping on Thursday. Trump said Wednesday he expected to reduce fentanyl-related tariffs on China ahead of the meeting.

— CNBC’s Sam Meredith, Steve Leisman and Sarah Min contributed to this market report.