European stocks open higher, ahead of Fed decision

Investors were upbeat ahead of the Federal Reserve’s decision, while eurozone bank lending picked up.

European stocks opened higher on Wednesday, ahead of the Federal Reserve’s latest decision on interest rates.

The Stoxx Europe 600 index was up 0.63 per cent in early morning trading.

The US Federal Reserve’s statement on monetary policy will be watched closely by investors, although the central bank isn’t expected to move interest rates this week. But any hints on the likelihood of a September rate rise could move markets.

Meanwhile, bank lending to firms and households in the eurozone picked up pace in June, data from the European Central Bank showed on Wednesday.

Lending to firms grew by 1.7 per cent on the year in June after 1.6 per cent in May. Lending to households also grew by 1.7 per cent after 1.6 per cent in the previous month.

In Asia, the Nikkei closed up 1.72 per cent after a Wall Street Journal report that the Japanese government may issue 50-year bonds for the first time, to take advantage from ultralow yields on Japanese sovereign debt.

The Japanese yen is down 0.78 per cent against the dollar. The Bank of Japan will announce its latest monetary policy decisions on Friday.

Second-quarter earnings season is in full swing, with results from Coca-Cola Co ahead of the US opening bell, and Facebook after markets close.

- Dow Jones newswires