Europe Markets

Europe stocks close flat, Portugal falls sharply

Europe stocks close flat, Portugal falls sharply

European stocks ended the day flat on Wednesday, ahead of latest meeting minutes from the Federal Reserve, although Portuguese stocks fell sharply amid concerns over one of the country's biggest financial groups.

The pan-European FTSEurofirst 300 index provisionally closed flat at around 1,363.76. Germany's Dax and France's Cac were both up around 0.4 percent, however Britain's FTSE 100 closed around 0.3 percent lower, pulled down by car insurer Admiral.

Lisbon's PSI index ended the day around 2.3 percent lower, driven by Espirito Santo Financial Group, the largest shareholder of Banco Espirito Santo, on concerns of the financial health of the group. Shares in the stock fell 11 percent before paring losses to close around 5.4 percent lower.

Global view

U.S. stocks stepped modestly higher on Wednesday, bouncing back after two days of losses. Alcoa gained in early New York trading after the aluminum producer late Tuesday

Focus will now turn to the minutes from the Federal Reserve's Open Market Committee later in the day. Traders are looking for comments about inflation in the minutes from the June 18 meeting, after Fed Chair Janet Yellen said in a post-meeting press briefing that the pick-up in CPI was just "noise."

Faster inflation could push the Fed to hike rates sooner; the timing of a rate hike is a market obsession.

"We expect some insights into the change in the committee's forecasts and an indication that it is putting less emphasis on the recent weakness in GDP growth and more on the labor market," Barclays analysts said in a note.

Meanwhile, Asian equities extended losses into a third session on Wednesday following a sell-off on Wall Street overnight and steady Chinese inflation data.

Stocks news

Insurer Admiral was among Europe's biggest fallers, ended the day down around 3.3 percent after the company reported a fall in first-half revenues.

Meanwhile, shares in Portugal Telecom slipped 5.5 percent after Brazil's state development bank, BNDE, lashed out at the company over recent bond investments. The lender said they were "inconsistent with minimum standards of good corporate governance".

Barclays said it was looking to offload its natural resource unit, which could be valued between $1 billion and $1.4 billion, according to reports. Shares in the bank closed over 1 percent lower.

French catering group Sodexo shares slid after the group cut its 2013-2014 sales target due to the delayed start-up of some major contracts. The stock fell up to 3 percent before paring losses to close around 1.7 percent.

U.S. drugmaker AbbVie raised its offer for Shire to 30.1 billion pounds on Tuesday, hoping to win over the Ireland-based pharmaceuticals group after three earlier offers were rejected. Shares in Shire had a bumpy ride on Wednesday, and ended the day 0.24 percent lower.

HSBC bucked the negative trend to close slightly higher, up 0.33 percent, on Wednesday. The bank said it had agreed to sell parts of its corporate and retail banking business in the Cayman Islands to Butterfield Bank Cayman for an undisclosed sum.

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