Fed’s latest rate decision ahead

Stocks on the move: Ams-Osram up 5.8%, Hannover Rueck down 5.1%

Semiconductor manufacturer Ams-Osram rose 5.8% to lead the Stoxx 600 after news it named Aldo Kamper, formerly of German cable and harness maker Aldo, as its new CEO.

At the opposite end of Europe’s benchmark, Hannover Rueck fell further by 5.1% in afternoon trade after reporting its full-year results.

—Karen Gilchrist

US stocks open lower ahead of Fed decision

U.S. stocks fell in early trade on Wednesday as investors awaited the Federal Reserve’s decision on interest rates.

The Dow Jones Industrial Average opened down 234 points, or about 0.7%. The S&P 500 fell nearly 0.3%. Meanwhile, the Nasdaq Composite was down 0.2%.

—Karen Gilchrist

US private payrolls rose by 106,000 in January, less than expected

U.S. companies added fewer jobs than expected in January, according to ADP.

Private payrolls rose 106,000 in January, short of the Dow Jones estimate of 190,000, as well as the 235,000 reported for December.

—Sarah Min

Novartis reports revenue stagnation, growth expected in 2023

Novartis CEO: Expect continued growth in 2023

Swiss drugmaker Novartis reported a core operating profit of $16.7 billion for 2022, roughly flat year-on-year.

It forecasts mid-single-digit growth for 2023, when it plans to spin off its Sandoz generics business.

Novartis CEO Vas Narasimhan told CNBC’s Geoff Cutmore that the company faced challenges in the first half of 2022, including hyperinflation and the ongoing impact of the coronavirus pandemic; but that these factors have stabilized and provide a tailwind for next year.

Narasimhan addressed the potential impact of the US Inflation Relief Act on drug prices, which he said could be offset in the near term, but would require a reassessment of strategy in the long term.

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He also discussed pharmaceutical legislation in Europe, where he said governments need to “refocus on healthcare” and the European Commission should “create a more pro-innovation environment”.

Shares of Novartis were down 2.26% in early evening trade.

—Jenni Reid

BBVA’s chairman discusses the company’s record profits

BBVA's chairman discusses the company's record profits

Bank of Spain BBVA reported record earnings for 2022, which it attributed to an increase in loan income growth and a strong performance in Mexico.

Net profit of 6.42 billion euros ($6.98 billion) for the full year beat analysts’ expectations.

Chairman Carlos Torres Vila told CNBC that he now expects lower growth than in 2022, “but still growth.”

BBVA shares were trading 3.6% higher around midday London time.

—Jenni Reid

Inflation in the euro zone has fallen for the third month in a row as energy prices continue to fall

Eurozone inflation reached 8.5% in January, according to preliminary data released on Wednesday.

The 20-member region underwent a significant price increase in 2022 after Russia’s invasion of Ukraine raised energy and food prices across the bloc. However, inflation began to decline in late 2022, showing two consecutive months of declining overall levels. In December, the rate was recorded at 9.2%.

— Silvia Amaro

Major central banks are set to signal a downward trajectory for interest rates

The US Federal Reserve, the European Central Bank and the Bank of England are all expected to raise interest rates again this week as they make their first policy statements of 2023.

Economists will be watching policymakers’ rhetoric closely for clues to future rate hikes this year, as the three major central banks attempt to prepare a soft landing for their respective economies without allowing inflation to gain momentum again.

The market is pricing in a 25 basis point hike from the Fed on Wednesday, but the key question is what the Federal Open Market Committee will indicate about another rate hike in 2023.

Meanwhile, the ECB and BOE are expected to hike by 50 basis points on Thursday.

Read the full story here.

— Elliott Smith

Stocks on the move: Husqvarna up 6.2%, QinetiQ down 4.2%

Swedish seller of outdoor equipment Husqvarna was the biggest gainer after the opening, up 6.2%, despite posting a higher operating loss for the fourth quarter. However, after adjusting for items including restructuring, the loss decreased.

At the bottom of the Stoxx 600 index, a British defense firm QinetiQ pour 4.2%.

German reinsurer Hanover Rueck fell by a similar amount after reporting higher full-year results that were in line with its previous forecast.

—Jenni Reid

European markets open higher as investors brace for another Fed hike

Europe’s Stoxx 600 rose 0.3% in early trade, with travel shares up 0.9% and financial services up 0.8%.

Britain’s FTSE 100 gained 0.25%, France’s CAC 40 rose 0.17% and Germany’s DAX rose 0.1%.

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The early-year rally fizzled, but European markets managed to climb 6.72% through January.

Wednesday will be dominated by the announcement of the Federal Reserve’s monetary policy, which is expected to increase by 25 basis points, as well as indications of its future development and assessment of the US economy.

—Jenni Reid

European markets: Here are the initial challenges

European markets are headed for a higher open midday as investors focus on the US Federal Reserve’s latest monetary policy statement today.

United Kingdom FTSE 100 The index is expected to open 10 points higher at 7,781 German DAX Up 30 points at 15,154, France CAC by 10 points to 7,096 and Italy FTSE MIB rose 75 points to 26,721, according to IG data.

Earnings come from Vodafone, GSK and Novartis. The main data in Europe on Wednesday is the flash inflation figures from the Eurozone for January.

—Holly Elliott

Factory activity in China is falling again

Factory activity in China signaled a further decline from previous data in January, albeit at a slower pace, marking the sixth straight monthly decline.

The Caixin Manufacturing Purchasing Managers’ Index for January came in at 49.2 on Wednesday, up slightly from December’s 49.0 but still missing Reuters expectations of 49.5

“Both production supply and demand continued to decline last month. The fallout from the pandemic was a drag on production and sales,” Caixin said in a press release.

– Lee Ying Shan

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