European shares rise ahead of Fed rate decision

(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window) May 3 (Reuters) - European shares rose on Wednesday as investors turn optimistic that U.S. Federal Reserve may signal a pause in its 14-month tightening cycle after raising interest rates for the last time later in the day.

The pan-European STOXX 600 index inched up 0.2% by 0715 GMT, after a sharp selloff in the previous session. Oil and gas shares were the top gainers on the index, rising 0.6%, recovering some of its losses from Tuesday. Automobile shares were in the red, falling 0.8%.

Investors anticipate that the Fed will follow through with a quarter percentage point hike at the end of its latest two-day policy meeting. The statement is due to be released at 2 p.m. ET (1800 GMT), with Chair Jerome Powell scheduled to speak to reporters half an hour later. Data on Tuesday showed banks are sharply turning off the credit taps, making a case for a smaller hike by the European Central Bank on Thursday. Shares in Italy's UniCredit jumped 5% as the lender raised its financial targets for the year after it posted stronger-than-expected first-quarter earnings Signify , the world's biggest lighting maker, fell 7.0% on missing first-quarter core profit expectations.

(Reporting by Shubham Batra in Bengaluru; Editing by Sonia Cheema)

Reuters

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European shares rise ahead of Fed rate decision

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