European stock markets are poised for a weaker start on Wednesday as global investors turn their attention to the U.S. Federal Reserve’s final interest-rate decision of the year.
Early indications from IG suggest the U.K.’s FTSE is set to open 0.34% lower, while Germany’s DAX is expected to slip 0.24%. France’s CAC 40 is seen down 0.25%, and Italy’s FTSE MIB is projected to fall around 0.3%.
The cautious mood comes as markets await clarity from the Federal Reserve, which is widely expected to implement its third consecutive quarter-percentage-point rate cut. Fed Funds futures point to an 87.6% likelihood of a reduction, though divisions persist within the Federal Open Market Committee. Some policymakers argue that easing is necessary to prevent further deterioration in the labor market, while others worry additional cuts risk reigniting inflationary pressures.
Investors will be watching closely for signals in the Fed’s post-meeting statement and comments from Chair Jerome Powell, whose afternoon press conference is expected to shape market expectations heading into 2026.
European sentiment also appears to have been weighed down this week by political tensions after U.S. President Donald Trump criticized regional leaders, calling them “weak” in an interview published by Politico on Tuesday.
