London stocks fall as investors looked to central bank meetings in Europe and the U.S.
How did markets perform?
The U.K.’s FTSE 100 UKX, -0.30% sank 0.2% to 7,427 after climbing 1.2% Tuesday.
The pound GBPUSD, +0.1831% rose 0.2% to $1.2582, erasing Tuesday’s 0.1% loss.
What’s moving the markets?
The U.S. Federal Reserve and the European Central Bank will both make announcements about policy Wednesday. Investors in Europe are already digesting ECB President Mario Draghi’s speech Tuesday signalling the bank stands ready to introduce fresh stimulus measures if economic conditions do not improve. The outlook for the Fed is more ambiguous, and the week has seen intense debate about whether it will signal cuts to its policy rate. While a survey of brokers by FactSet sees the Fed introducing cuts at this meeting, some think it more likely the central bank will keep its powder dry ahead of the G-20 summit.
U.S. President Donald Trump gave fresh hope to investors as he announced on Twitter on Tuesday that he would meet Chinese President Xi Jinping at the G-20 summit next week in Osaka, Japan. Trade negotiations had been stalled since mid-May.
In economic data, U.K. inflation came in slightly above expectations. CPI core inflation for May was 1.7% higher year over year, versus 1.6% expected. In Germany, PPI inflation missed the consensus, rising 1.9% in May year over year, short of the 2.1% expected.
Which stocks are active?
Saga PLC SAGA, -11.76% shares plummeted 12.3% after the travel and insurance company announced a trading update and warned that the travel market is highly challenging due to political uncertainty.
British Airways parent International Consolidated Airlines Group SA IAG, -2.73% announced at the Paris Air Show that it had ordered 200 of Boeing’s troubled Max 737 jets. The move is a massive vote of confidence in the aircraft model, which was grounded following two crashes involving the same model. Shares in IAG were down 4.4%.
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