Markets Stutter On Eve Of Fed Rate Call

Global stock markets faltered Wednesday with investors nervous on the eve of the US Federal Reserve's latest interest rate decision.

LONDON, Sept 19, (UrduPoint / Pakistan Point News - 19th Sep, 2017 ) - Global stock markets faltered Wednesday with investors nervous on the eve of the US Federal Reserve's latest interest rate decision.

London and Paris held firm but Frankfurt flatlined, after a broadly downbeat session in Asia and despite surging Tokyo stocks. Equities had rallied Monday as investors turned their attention to macro issues, particularly the Fed's policy meeting, and US President Donald Trump's maiden speech to the UN General Assembly.

All eyes are now on the US central bank, whose two-day gathering kicks off later Tuesday, amid global moves towards tighter monetary policy. While the Fed is not expected to raise interest rates, remarks from the Fed and its boss Janet Yellen will be pored over for clues about future moves -- with talk of another rise -- and plans to wind down the vast bond-buying stimulus put in place during the financial crisis.

"I suspect they are not going to raise rates quite yet; I suspect they will guide towards December," said David Hussey, head of international core equities at Manulife Asset Management. "The US economy is in reasonably good health at the moment.

It's doing okay. "Unemployment is very low and the weak Dollar is probably going to boost a bit of inflation so she (Yellen) will probably be raising rates again early next year." - 'Incredibly low rates' - ========================== With global economic growth improving, major central banks around the world are mulling moves to tighten monetary policy.

That has sparked investor jitters over the impact of higher borrowing costs on consumers, businesses and financial markets. "There's no reason not to start normalising policy. People are obsessing about this," Hussey told AFP.

"The big picture is that we are at incredibly low rates and they have to start slowly moving back up to some sort of normal neutral level, which is probably some way higher than they are at the moment.

"So ... people see it coming and therefore they are nervous. It's as simple as that." The Fed is also expected this week to announce the start of a plan to gradually reduce the multi-trillion dollar investment holdings built up to support the economy in the wake of the 2008 financial crisis.

- Key figures around 1045 GMT - ================================= London - FTSE 100: UP 0.3 percent at 7,277.40 points Frankfurt - DAX 30: FLAT at 12,554 Paris - CAC 40: UP 0.1 percent at 5,236.50 EURO STOXX 50: UP 0.1 percent at 3,530.10 Tokyo - Nikkei 225: UP 2.0 percent at 20,299.38 (close) Hong Kong - Hang Seng: DOWN 0.4 percent at 28,051.41 (close) Shanghai - Composite: DOWN 0.2 percent at 3,356.84 (close) New York - DOW: UP 0.3 percent at 22,331.35 (close) Euro/dollar: UP at $1.1986 from $1.1954 at 2100 GMT Dollar/yen: UP at 111.64 Yen from 111.56 yen Pound/dollar: DOWN at $1.3491 from $1.3501 Oil - Brent North Sea: UP 29 cents at $55.77 per barrel Oil - West Texas Intermediate: UP 43 cents at $50.34