- France unveils new spending cuts
- Yellen says Fed will remain accommodative
- Ukraine talks begin in Geneva
FTSE 100: -0.16%
CAC 40: 0.02%
FTSE MIB: 0.04%
IBEX 35: -0.03%
Stoxx 600: -0.09%
European stocks were little changed after France unveiled measures to cut spending in an effort to repair public finances.
French Prime Minister Manuel Valls yesterday revealed he plans to save €50bn between 2015 and 2017 by reducing spending on welfare benefits, a politically sensitive area.
It includes freezing benefit and pension payments at current levels for the next year. A freeze in the basic pay of civil servants will also continue, Valls said.
He noted that public spending represents 57% of national wealth, adding that "we can't live beyond our means".
"Although France's short-term outlook remains weak, the new French Government's recent policy announcements provide hope that France is slowly tackling its significant competitiveness problems," Capital Economics said.
"[...] France is on the road to recovery, but it is in the slow lane. The Eurozone's second largest economy will provide only modest support for its even weaker neighbours such as Spain and Italy."
Federal Reserve Chair Janet Yellen said the central bank is committed to maintaining an appropriate level of monetary accommodation to support the country's economic recovery.
Speaking at the Economic Club of New York after European markets closed yesterday, she said investors should look for shortfalls in both inflation and the jobless rate for indications on the Federal Open Market Committee's decision on the federal-funds rate. The Fed's next policy meeting is on April 29-30th.
The central bank's Beige Book business survey was released overnight, showing that eight of its 12 districts experienced "modest or moderate" growth based on reports gathered before April 7th.
Today in the US will be the release of the initial jobless claims report which is expected to come in at 315,000 for the week ended April 12th, compared to 300,000 claims a week earlier.
Talks on Ukraine begin
Talks in Geneva between the US, Russia and Ukraine and the European Union will be high on the agenda for global financial markets today.
However, the potential for more aggressive sanctions on Moscow may be limited given warnings from blue chip firms that they could affect business.
Companies such as German chemical group BASF, Italian energy firm Eni and British oil major BP have all expressed their caution to governments about the fall-out from tougher sanctions and any possible retaliation from the Kremlin.
Tensions along the eastern border of Ukraine have escalated in recent days due to the occupation of government buildings by pro-Russian militants. Three pro-Russian separatists were reportedly killed overnight, according to Ukraine's Interior Minister.
SAP AG declined after Germany's biggest technology company reported quarterly sales and earnings that missed analysts' estimates.
Actelion advanced after the bio-pharmaceutical company said it may review its earnings forecasts after reporting better-than-estimated quarterly profits.
Akzo Nobel NV dropped after posting first quarter revenue that fell short of forecasts.
Thomas Cook gained after Standard & Poor's raised its outlook on the tour operator from 'stable' to 'positive', citing the progress in its transformation strategy.
The euro rose 0.19% to $1.3842.
Brent crude futures fell $0.009 to $109.590 per barrel, according to the ICE.