Stocks, currencies on hold as traders wait for Fed

Bloomberg

Markets were largely in a holding pattern on Wednesday, with European stocks struggling to maintain gains and the dollar edging lower as investors awaited fresh insight on the path for borrowing costs
in the world’s biggest economy. China’s credit-rating downgrade sank industrial metals.
The Stoxx Europe 600 Index erased most of its advance as auto makers fell in the wake of the
US Justice Department’s lawsuit against Fiat Chrysler Automobiles NV. Moody’s Investors Service reduced its rating on the world’s biggest commodities consumer, triggering declines across copper, nickel, zinc and iron ore. The British pound also trimmed most gains after Prime Minister Theresa May warned that further terrorist attacks could be imminent. Crude edged higher for a sixth day as OPEC prepared for a key meeting in Vienna.
Moody’s action on China briefly rattled Asian markets, but against a backdrop of strengthening global growth and the impending release of minutes from the Federal Reserve’s latest meeting, investors appeared to quickly move on. Fed Bank of Philadelphia President Patrick Harker said June “is a distinct possibility” for the US central bank’s second interest-rate increase of 2017.
On the data front on Wednesday, notable indicators include US wholesale inventories and existing home sales numbers. Canada releases a monetary policy decision the same day, followed by South Korea on Thursday. OPEC will
meet in Vienna on Thursday, with major oil producers edging closer to extending an agreement to
curb output.
The pound was little changed at $1.2969 as of 8:30 a.m. in New York, following a two-day loss. The euro was 0.1 percent higher at $1.1194. The Bloomberg Dollar Spot Index edged lower by 0.1 percent after climbing 0.3 percent Tuesday.
Nickel slumped 2 percent and copper fell 0.6 percent. Iron ore futures dropped 5 percent. China is the top user of materials. West Texas oil slipped 0.3 percent to $51.32 a barrel after a five-day advance. Gold added 0.1 percent to $1,252.77 an ounce, after dropping 0.8 percent on Tuesday.
The Stoxx Europe 600 Index rose less than 0.1 percent. Futures on the S&P 500 were little changed. The underlying gauge rose 0.2 percent Tuesday, reaching as high as 2,400.85, two points from a closing record.
The yield on 10-year Treasury notes was little changed at 2.27 percent. Bonds fell during the
previous four days. Yields on benchmark French and German benchmark bonds dropped two basis points.