Global stocks muted as Fed meeting awaited

Associated Press
People look at an electronic stock indicator in Tokyo, Tuesday, Oct. 29, 2013. Asian stock markets were mostly lower Tuesday as investors waited for a U.S. Federal Reserve policy meeting this week for clues about when the central bank will begin reducing its monetary stimulus. Japan's Nikkei 225 was down 0.49 percent at 14,325.98. (AP Photo/Shizuo Kambayashi)
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People look at an electronic stock indicator in Tokyo, Tuesday, Oct. 29, 2013. Asian stock markets were mostly lower Tuesday as investors waited for a U.S. Federal Reserve policy meeting this week for clues about when the central bank will begin reducing its monetary stimulus. Japan's Nikkei 225 was down 0.49 percent at 14,325.98. (AP Photo/Shizuo Kambayashi)

FRANKFURT, Germany (AP) — Global stocks traded indecisively Tuesday, as investors waited for a U.S. Federal Reserve policy meeting for clues about when the central bank will begin reducing its monetary stimulus.

In Europe, gains were held back by investor caution ahead of the Fed's two-day meeting starting later Tuesday, and by mixed corporate earnings reports. Stocks eased in Japan and rose in Hong Kong.

The world's stock markets have been supported for several years by the Fed's mammoth efforts to expand the money supply and stimulate the U.S. economy. But as the world's biggest economy slowly recovers from the 2009 recession, the Fed is expected to start scaling down its purchases of government bonds and mortgage securities that total $85 billion a month.

Markets had previously expected the withdrawal of stimulus to begin this year but expectations have shifted to next year as the pace of improvement in the U.S. economy waned. The wording of the Fed's statement this week will be scrutinized for any new indications about when that process will begin. Any hints of change could roil markets.

By early afternoon in Europe, Britain's FTSE 100 was 0.5 percent higher at 6,760.48. Germany's DAX was up 0.2 percent at 8,994.47 and France's CAC-40 added 0.4percent to 4,267.61.

Winners in Europe included oil company BP, whose shares traded up 4.6 percent after its earnings beat expectations and the company raised its dividend.

Shares in several major banks dipped on news of added litigation expenses. Deutsche Bank fell 1.6 percent after earnings fell well short of expectations due to expenses for litigation over mortgage-backed securities in the United States. UBS shares were off 6.5 percent after the bank met earnings expectations but said it probably would not achieve its profit target due to Swiss regulatory demands that it hold more capital for litigation risks.

Futures in New York pointed to a flat open on Wall Street, with Dow Jones futures flat at around 15,521 and S&P 500 futures up a bare 0.1 percent at 1,760.50.

Japan's Nikkei 225 closed 0.5 percent down at 14,325.98 while Hong Kong's Hang Seng see-sawed between gains and losses, finishing up 0.2 percent at 22,846.54.

Benchmarks in New Zealand, Malaysia and Indonesia closed slightly lower, while indexes in South Korea and Taiwan both rose 0.2 percent. China's Shanghai Composite finished 0.2 percent lower at 2,128.86.

Benchmark crude for December delivery was down 59 cents at $98.09. The euro fell 0.2 percent to $1.375 and the dollar rose 0.2 percent to 978.9 yen.

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Cerojano contributed from Manila, Philippines.

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