European stocks traded mixed and US equity futures slipped ahead of a Federal Reserve policy decision and bond yields rose. Deutsche Bank shares rose after the bank reported its best quarter in years. The Stoxx Europe 600 SXXP Index, -0.09%, fell 0.1% to 439.28, while the German DAX DAX, + 0.29% and the French CAC 40 PX1 indices, + 0.38% each rose 0.2%, and the FTSE 100 UKX, rose + 0.18%. 0.2%. The strength of the dollar weighed on both the GBPUSD, -0.19% and the EURUSD, -0.18%.
US stock futures ES00, + 0.04% YM00, -0.15% NQ00, -0.22% were mostly lower before a Federal Open Market Committee (FOMC) policy decision later, and after a flat or slightly lower close for the stock on Tuesday. In the immediate aftermath of the biggest jump in four weeks, the US 10-year Treasury yield BX: TMUBMUSD10Y rose another 3 basis points to 1.6503% on Wednesday. Investors appeared to be positioning themselves ahead of the Fed’s decision, although most analysts do not anticipate a change in tone or a major policy decision. “While the general consensus is that Jerome Powell and the rest of the FOMC will keep things unchanged tonight, there have been some reports that suggest that the issue of phasing out bond purchases could be addressed. If that’s the case, then the markets could be about to end April on a weak note, ”said Connor Campbell, a financial analyst at Spreadex, in a note to clients. That move was putting pressure on European bond yields, with German 10-year BX: TMBMKDE-10Y yields and 10-year British gold BX: TMBMKGB-10Y rising slowly. On the data front, market research group GfK said German consumer confidence will drop in May, amid rising COVID-19 infections and tightening of lockdown restrictions. Elsewhere, prices in UK retail stores continue to fall, but at a slower pace, an indication that prices could start to rise as the economy begins to normalize after reopening, according to the latest report. Nielsen and the British Retail Consortium. Deutsche Bank DB, + 1.73% DBK, + 6.95% reported higher than expected earnings and income, helped by strong performance from its investment bank. The German lender boosted its income outlook for the full year, as well as for its investment banking unit. The shares rose nearly 7%, and Citigroup analysts said it was the best quarter for Deutsche Bank in eight years. “The pace is broad-based across all divisions and has allowed the company to offer a more optimistic outlook for fiscal 21 for revenue and provisions. A very good set of results, ”said a team of Citi analysts led by Andrew Coombs, in a note to clients. Shares of Lloyds Banking Group LYG, + 3.00% LLOY, + 4.05% rose 3.1%, after reporting a sharp increase in first quarter profit before tax, which beat expectations thanks to an impairment credit. The UK bank improved its outlook for the year. Shares of Delivery Hero DHER, + 7.18% also rose close to 5.9%, after the Berlin-based food delivery company reported a skyrocketing rise in revenue and orders during the first quarter in means of “exceptional rapid trade growth”. The company also issued a guide for the year. WPP WPP, + 3.36% WPP, -0.99% Stocks increased 3%, after becoming the latest ad group to publish results that beat forecasts as the industry recovers from the COVID-19 pandemic. The company reported a surprise return to comparable net sales growth in the first quarter. Sanofi SNY shares, -0.60% SAN, + 1.77% rose 1.5%, after the French pharmaceutical company reported lower net earnings and sales for the first quarter, but supported its outlook for 2021. Sanofi expects commercial earnings per share grow in high single digits at constant exchange rates, barring unforeseen events. Puma PUM, -3.01% reported an increase in earnings and sales in the first quarter despite restrictions related to coronavirus and supply chain problems. Shares of the German sporting goods company fell almost 2%. Carlsberg CARL.A, -1.44% raised the lower end of its targeting range and launched a new larger buyback program of up to DKK1 billion after posting first quarter revenue and volumes that beat forecasts. The shares were up 1%. J Sainsbury SBRY shares, -2.35%, fell nearly 3%, after the British grocer switched to a pre-tax loss for fiscal 2021 as the pandemic increased costs and offset rising revenues.