- US debt ceiling looms
- German industrial data beats forecasts
- Obama to name Yellen as Fed Chair
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European equities were mixed as investors digested industrial production data and weighed US debt ceiling talks.
German industrial production rose 1.4% in August from July when it fell a revised 1.1%, according to the Economy Ministry in Berlin.
It beat forecasts for an increase of 1%, signalling a further uptick in the recovery of Europe's biggest economy.
In contrast, UK industrial production contracted sharply by 1.1% month-on-month in August, compared to consensus for a rise of 0.4%, the Office for National Statistics said. Manufacturing activity fell by 1.2%, missing economists' predictions for an increase of 0.4%.
In the US, the government continues to stall on making any headway on the federal budget and debt ceiling negotiations.
President Barack Obama has told Republicans they need to lift "threats" against the economy before he will hold budget talks with the opposition.
Republicans have been pushing for a delay to Obama's controversial health bill but Democrats are holding their ground.
In his weekly address on Tuesday, Obama said Republicans "don't get to demand ransom in exchange for doing their jobs".
"There's only one way out of this reckless and damaging shutdown: pass a budget that funds our government, with no partisan strings attached," he said.
House Speaker John Boehner, however, said that an immediate increase in the debt ceiling without conditions was "unconditional surrender". "There's going to be a negotiation here [...] It's time to have that conversation," he said.
The government has until October 17th before reaching its $16.7trn debt ceiling and running of cash to pay its bills. It could see the nation default on its debt, which would send shock waves throughout the rest of the world.
Yellen to be appointed Fed Chair
President Barack Obama will nominate Janet Yellen, Vice Chairman of the Federal Reserve, for the position of Chair, replacing Ben Bernanke next year.
Obama will announce the nomination at 15:00 in Washington, White House officials told Bloomberg in an emailed statement.
"This is generally seen as a positive appointment for financial markets as Yellen is widely regarded as even more dovish than Bernanke, which could help prolong the Fed's asset purchases well into next year," according to Craig Erlam, Market Analyst at Alpari.
The Federal Reserve will later today release minutes from last month's policy meeting when it shocked investors with its decision to keep its stimulus measures and interest rate unchanged. The minutes will shed further light on who was for or against the move.
EU commissioner on ESM
The European Union (EU) Internal Market and Services Commissioner Michel Barnier said that the European Commission could be the resolution agency for the winding down of financial institutions before the permanent bailout fund, known as the European Stability Mechanism (ESM) takes over.
"The bailout fund could take over banking resolution as soon as it has become a European institution", Barnier told the German business daily Handelsblatt on Wednesday.
Royal Bank of Scotland's shares
fell after a Bloomberg report said the lender has sent records of chats between a former currency trader and other firms to the UK's Financial Conduct Authority (FCA) to be examined for possible violations.
Alcatel-Lucent declined after French Prime Minister Jean-Marc Ayrault said the network-equipment maker's restructuring plans won't be approved without an agreement limiting job cuts.
Taylor Wimpey advanced after as Goldman Sachs gave the house builder a 'conviction buy' rating.
PSA Peugeot Citroen rose following news China's Dongfeng Motor Corp. will buy a stake in the European carmaker for 10bn yuan.
Vedanta Resources slumped after saying second-quarter copper output in Zambia fell by 26%.
The euro fell 0.34% to the 1.3527 US dollar.
Brent crude futures were up $0.045 to $110.210 per barrel on the ICE.