- Investors speculate over Fed stimulus
- EU banks may miss deadlines for ECB stress test
- UK industrial production rises
- Chinese factory output slows
- Italy's economy stagnates
FTSE 100: -0.55%
CAC 40: -1.04%
FTSE MIB: -0.27%
IBEX 35: -0.52%
Stoxx 600: -0.71%
European stocks slipped on speculation that the Federal Reserve will begin scaling back its monetary stimulus at its meeting next week.
The Federal Open Market Committee is anticipated to announced a reduction of its monthly $85bn bond buying programme at its December 17th -18th meeting, according to 34% of economists surveyed December 6th by Bloomberg.
President of the St. Louis Federal Reserve Bank James Bullard said yesterday that given the improving labour market a small taper would allow the central bank to monitor inflation next year.
Last week the Labor Department revealed the unemployment rate fell to 7% in November, the lowest level in five years.
Bullard was one of three Fed speakers yesterday who hinted at the possibility of a withdrawal of quantitative easing.
Fed officials and well-known hawks Richard Fisher and Jeffrey Lacker warned of the risks and costs of the $85bn per month bond buying programme. They said central bankers would discuss pulling back the pace of its asset purchases but gave no specific details.
In other US news, Representative Steny Hoyer said in an interview on CNBC today that he doesn't like what he has heard about the budget deal.
US Congress has until Friday to reach a deal to reduce automatic spending cuts and break a three-year run of failed fiscal talks in Washington.
EU bank stress tests
Moody's warned today that some European Union banks may fail to provide accurate data and meet deadlines for next year's series of regulatory reviews.
Eurozone banks, which have already supplied their first batch of data for the European Central Bank's (ECB)supervisory risk assessment, will be asked for more data between January and June.
The mass of extra data will be used for the ECB's 'Asset Quality Review', which looks at whether banks have properly valued loans in key areas of their business.
UK and China factory output
UK industrial output rose in line with expectations by 0.4% in October, compared to a 0.9% increase in September, the Office for National Statistics revealed.
Chinese factory production climbed 10% in November from a year ago, compared to a 10.3% jump in October, the National Bureau of Statistic said. Analysts had predicted a 10.1% rise.
Meanwhile, in Italy the economy stagnated in the third quarter, ending two years of contraction.
National statistics bureau ISTAT revised up a preliminary estimate to show gross domestic product was unchanged between July and September, initially reported as a 0.1% fall.
Victrex advanced as the UK maker of heat-resistant plastics for auto, energy and health-care companies proposed a final dividend of 32.65p, beating forecasts.
CGG SA rallied after Raymond James Financial Inc. a 'buy' rating for the French-based geophysical services company's stock.
Royal Vopak declined after the Dutch oil and gas tank storage provider said it was unlikely reach its goal of €1bn in earnings before interest, taxes, depreciation and amortisation in 2016.
Randgold Resources topped the FTSE 100, tracking the price of gold higher, which was up $29, or 2.35%. Likewise, Fresnillo, which fell earlier in today's session, rebounded into positive territory despite lowering its annual gold production forecast by 8.4% to 425,900 ounces.
The euro rose 0.19% to $1.3765.
Brent crude futures dropped $0.524 to 108.810 per barrel, according to the ICE.