Fed decision, stocks and inflation data

Gerhard Orgonas, head of continental Europe mid cap research at Berenberg, discusses the German economy’s recent struggles.

Jamie Dutta, market analyst at Vantage, weighs in on the outlook for Federal Reserve monetary policy moves ahead of the central bank’s upcoming interest rate decision.

Shares of Just Eat and Delivery Hero topped the Stoxx 600 in early trading after a U.S. federal judge ruling on delivery fee caps.

Europe-listed shares of Delivery Hero and Just Eat were each up 7% after a district judge said Tuesday that food groups could sue New York City over a law capping how much they can charge restaurants for delivering meals. The ruling prompted U.S.-based delivery company shares to rise, and the knock-on effect was felt across the Atlantic.

— Hannah Ward-Glenton

Shares of Swiss insurance company Baloise were down 8% in early trading after it reported disappointing first-half results.

Profit attributable to shareholders fell to 214.7 million Swiss francs ($239 million), down from 205.7 million in 2022.

Baloise said the reduction was driven by lower profits in the life business, as well as higher costs and negative currency effects.

Shares of German insurer Talanx slid 7% after the company initiated a capital increase of up to 300 million euros Tuesday.

“This move is our response to repeated requests from investors to increase Talanx’s free float and to lay the foundations for improving the shares’ trading liquidity,” Jan Wicke, Talanx AG’s CFO, said in a press release.

— Hannah Ward-Glenton

European markets opened cautiously higher on Wednesday as global investors await the latest monetary policy decision from the U.S. Federal Reserve.

The pan-European Stoxx 600 index opened 0.2% higher, with sectors spread across marginally positive and negative territory. Health-care stocks led gains with a 0.9% uptick, while oil and gas dipped 0.8%.

— Hannah Ward-Glenton

U.K. inflation came in at 6.7% in August, below expectations and down slightly from the previous month.

On a monthly basis, the headline consumer price index (CPI) rose by 0.3%.

Economists polled by Reuters expected the headline figure to come in at 7% annually and up 0.7% month-on-month, compared to July’s 6.8% and 0.4% month-on-month decline, amid a slight uptick in prices at the pump.

The full story can be found here.

— Elliot Smith

The Federal Reserve is widely expected to hold rates steady Wednesday, but the central bankers will give an update on their economic outlook with the summary of economic projections, which includes one key chart that traders will have an eye on.

The so-called “dot plot” that charts the projected move in the Fed funds rate and the press conference of Chair Powell will give investors a clue as to what happens in the November meeting and into 2024.

“I think that they will keep that bias towards higher rates in there and indicate that they are willing to raise the funds rate further if the data start to show that either inflation is not slowing as they expect it to, or if the labor market remains too tight,” said Gus Faucher, chief economist at PNC Financial Services Group.

Read more about the meeting here.

— Jeff Cox, Jesse Pound

Falling house prices and rising rents are expected to benefit two U.K. stocks, according to stock analysts.

As mortgage rates go up and pile pressure on housebuilders to improve sales, these two unique stocks are poised to take advantage of the environment.

The analysts expect one of the stocks to rise by more than 60% over the next 12 months, thanks to the trend.

CNBC Pro subscribers can read more here.

— Ganesh Rao

Raymond James Investment Management’s Matt Orton says one tech giant is the “cheapest of all the mega-cap names” right now.

It’s one of “two big long-term winners” in artificial intelligence and is underappreciated in that area, he told CNBC.

CNBC Pro subscribers can read more here.

— Weizhen Tan

European markets are expected to open in mixed territory Wednesday.

The U.K.’s FTSE 100 index is expected to open 21 points lower at 7,636, Germany’s DAX up 4 points at 15,659, France’s CAC flat at 7,270 and Italy’s FTSE MIB down 40 points at 28,747, according to data from IG.

Data in the spotlight in Europe on Wednesday includes U.K. inflation data for August and new car registrations for the U.K., Germany, the Netherlands, Italy and France.

— Holly Ellyatt