European equity markets were mixed on Tuesday as investors weighed a wave of corporate earnings against the backdrop of a highly anticipated monetary policy meeting by Federal Reserve System.
At 08:05 GMT, Germany’s DAX was down 0.3%, France’s CAC 40 slipped 0.2%, while the FTSE 100 in London edged 0.2% higher.
Markets look to Fed
The main focus of the week is the Fed’s two-day policy meeting, which begins later today. The U.S. central bank is widely expected to lower interest rates by 25 basis points on Wednesday, following last week’s inflation report showing annual inflation slowing to 3% in September — below expectations.
According to the CME FedWatch tool, traders are pricing in a 96% probability of a rate cut this week. Markets are also awaiting signals from Fed Chair Jerome Powell regarding the likelihood of another policy easing in December amid signs of a cooling labor market.
Other major central banks are also in the spotlight this week, with meetings scheduled at Bank of Japan, Bank of Canada and European Central Bank.
The ECB is expected to keep its policy rates unchanged, as inflation remains near its 2% target and growth appears steady. Meanwhile, sentiment in Germany is showing signs of weakening, with the GfK consumer confidence index falling to -24.1 points for November, from -22.5 points in October.
Trade talks in focus
Global trade developments also remain a key market driver. U.S. President Donald Trump is set to meet Chinese President Xi Jinping in South Korea on Thursday, where the two are expected to finalize a trade deal. Optimism has grown after negotiators in Kuala Lumpur reached a draft agreement aimed at avoiding new tariffs.
Trump also met Japan’s new Prime Minister Sanae Takaichi in Tokyo on Monday to discuss defense cooperation, trade, and a $550 billion U.S. investment package announced earlier this year.
HSBC hit by legal charge, earnings roll in
The earnings season continued to generate headlines across Europe. HSBC Holdings plc (LSE:HSBA) reported a 14% drop in pretax profit for Q3, mainly due to a $1.1 billion legal provision. However, the bank raised its income outlook for the year, citing expectations of slower-than-expected rate cuts in key markets like Hong Kong and the U.K.
BNP Paribas (EU:BNP) reported a 6.1% rise in profit, supported by strong trading gains and the first contribution from AXA Investment Managers.
Novartis AG (BIT:1NOVN) posted higher Q3 sales and earnings, reaffirming its annual guidance as demand for key prescription drugs and late-stage pipeline progress remained robust.
Amundi S.A. (EU:AMUN) also beat profit expectations but noted that its 2028 strategy will factor in the uncertainty tied to the expiration of its distribution agreement with UniCredit S.p.A. in 2027.
Miner Anglo American plc (LSE:AAL) reaffirmed its full-year guidance despite mixed operational results — stronger manganese and diamond output offset weaker iron ore volumes.
Capgemini SE (EU:CAP) raised its 2025 growth outlook after a better-than-expected quarter, driven by solid North American demand and expansion in cloud, data and AI services.
Oil slides on OPEC+ production outlook
Crude prices fell Tuesday as investors reacted to reports of planned production hikes by OPEC+. Brent futures were down 1.3% at $64.03 a barrel, while U.S. West Texas Intermediate slid 1.5% to $60.40.
According to Bloomberg, OPEC+ is considering increasing output in December, with discussions pointing to a third monthly hike of 137,000 barrels per day. The move would aim to regain market share amid persistently weak oil prices.
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