- US, UK and France to launch military action in Syria
- Syria crisis pushes oil prices
- German consumer confidence eases slightly
- BoE's Carney to deliver highly-awaited speech
FTSE 100: -0.63%
CAC 40: -0.43
FTSE MIB: -0.13%
IBEX 35: -0.12
Stoxx 600: -0.87%
European stocks dragged as the price of oil surged amid concerns the US would launch military strikes against Syria.
The US said it was ready to intervene in Syria's crisis after accusing the country's regime of using chemical weapons against civilians last Wednesday in an attack that left about 300 dead.
US Vice-President Joe Biden said there is "no doubt" that the Syrian government used chemical weapons.
The Syrian government has firmly denied the claims and said it would defend itself against any military action from international governments.
The US said it will release its own intelligence report into the incident at Ghouta, a suburb of the capital.
The UK will put a resolution to the United Nations Security Council later on Wednesday "authorising necessary measures to protect civilians" in Syria.
While the UK, the US and France are behind military action, Russia and China is expected to block the efforts as the countries have previously vetoed resolutions critical of Syria.
The reports pushed the price of Brent and Nymex futures up over $1.20 each at $115.60 and $110.55 respectively.
"Once filtered through to the real global economy, the increase in oil prices will put a halt to the current pace of economic momentum we are currently experiencing in major parts of the world," said Ishaq Siddiqi, Market Strategist at ETX Capital.
"It's plausible that Brent oil prices could be over $120 per barrel in the coming days - and, if oil prices spike even higher [above $130 per barrel], it wouldn't be out of the question for the Federal Reserve to hold off on tapering stimulus measures this year."
German consumer confidence eases
German consumer confidence eased slightly from a six year high heading into September, according to data Wednesday.
The GfK Consumer Confidence Survey's forward-looking sentiment indicator fell to 6.9 going in to September from 7 in the previous month. It was the highest level since before the global financial crisis and undercut forecasts for the reading to hold steady.
In the US, a report on pending sales of previously owned homes is expected to show little change last month after declining 0.4% in June, according to consensus data.
In the UK, traders will be closely watching Bank of England's new Governor Mark Carney who is expected to reiterate that the central bank will keep interest rates at record low levels in an attempt to shore up forward guidance policy.
UK watchdog tells Ryanair to cut stake in Aer Lingus
Ryanair Holdings slumped after UK regulators ordered the budget carrier to cut its stake in Aer Lingus Group to 5% from 30% due to concerns over hurting competition in Ireland.
Polymetal International tumbled as the gold and silver miner posted a first-half net loss of $255m, compared with a $157m profit a year earlier.
Accor declined after reporting first-half profit that fell short of analysts' expectations.
Bouygues advanced as the French contractor reported a 10% increase in second-quarter profit which exceeded forecasts.
Statoil gained after the Norweigan energy company made its third oil discovery off the coast of Canada in the Flemish Pass basin and Bank of America raised the stock to 'buy' from 'neutral'.