European shares rise as oil rally pauses; all eyes on Fed

Business Recorder reported that European equities bounced back on Wednesday, following a pair of down sessions, as a pause in the oil rally lifted appetite for risk before the US Federal Reserve's policy decision. The pan-European STOXX 600 gained 0.4% to 636.81 points by 0705 GMT, and gains were broad, with Germany's DAX adding 0.4%.

Traders were pricing in a 93% probability that the Fed raises rates by 25 basis points, according to CME FedWatch data. Inflation linked to the Iran conflict has led markets to revisit their rate outlook. Oil prices paused their rally and slipped 0.6% on Wednesday, which let energy-sensitive stocks rebound, with banks among the top gainers. Barclays climbed 1.4% and Standard Chartered 1.7%, after both helped push the STOXX 600 to a three-month low on Tuesday.

The defence and engineering group from Britain, Babcock International, rose 2.5% after keeping its annual forecast intact. Barratt Redrow lowered its home completions target for fiscal 2027, given planning delays and fewer new sales sites opening, yet its shares still gained 5.1%.