Limited movements in European stocks ahead of Fed’s rate decision

European stocks moved in a limited range on Tuesday as investors returned from the Labor Day holiday on Monday ahead of decisions by the Federal Reserve and the European Central Bank to raise interest rates later this week.

The pan-European Stoxx 600 index rose 0.1% by 0715 GMT, with banks and technology companies leading the index’s gains, up 1.2% and 0.8%, respectively.

Oil and gas stocks fell 0.9 percent, tracking the impact of oil prices.

The Federal Reserve is expected to raise interest rates by 25 basis points on Wednesday, but investors will still be waiting to see if the US central bank will signal a pause in interest rate hikes after May.

HSBC Holdings jumped 3.9 percent after quarterly profit beat expectations and tripled as higher interest rates around the world boosted bank income.

Electrolux rose 6.6 percent, the biggest gainer on the index, after reports that China’s Midea Group was close to a potential takeover of the Swedish home appliance maker.

Meanwhile, BP shares fell 3 percent after the company scaled back a share buyback plan, but made a profit of $5 billion in the first quarter of 2023, up from the previous three months.

Investors are awaiting preliminary inflation figures in the euro zone for April, due at 0900 GMT, for additional indications of the European Central Bank’s tightening path.