(RTTNews.com) - The majority of the European markets ended Wednesday's session with modest losses. The political deadlock in Washington on the issue of increasing the debt ceiling continued to worry investors. The standoff over Obamacare could result in a government shutdown if a new continuing resolution is not passed before funding runs out at the end of the month. Meanwhile, Germany's consumer morale reached its highest level in six years.
The Bank of England's Financial Policy Committee (FPC) said it will keep a close watch on the country's housing market developments and will be alert to potential risks to financial system stability.
The recovery in the housing market "appeared to have gained momentum and to be broadening," the FPC said in a statement from its policy meeting on September 18. Mortgage approvals in July were 30 percent higher than a year earlier and average house prices have risen 5 percent since August 2012.
The ongoing improvement in Germany's business confidence, as indicated by the latest Ifo survey, suggests that the ongoing economic recovery is gaining strength, IHS Global Insight's senior German economist Timo Klein said.
IHS Global Insight said that notwithstanding the restraining effect from the lingering Eurozone debt crisis and some worries about global growth momentum, supportive factors like the persistently low short- and long-term interest rates and a subdued euro are increasingly having a stimulative effect on the German economy.
The Euro Stoxx 50 index of eurozone bluechip stocks increased by 0.08 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.08 percent.
The DAX of Germany rose by 0.01 percent, but the CAC 40 of France fell by 0.01 percent. The FTSE 100 of the U.K. decreased by 0.30 percent, but the SMI of Switzerland gained 0.10 percent.
In Frankfurt, Gerresheimer declined by 1.14 percent. Commerzbank downgraded its rating on the stock to ''Add'' from ''Buy.''
Citigroup named RWE a ''Least Preferred Stock'' for next 3 months. The shares finished up by 0.36 percent.
ThyssenKrupp increased by 3.74 percent, after Cevian Capital acquired a stake in the steel firm.
Commerzbank dropped by 6.03 percent and Deutsche Bank lost 2.55 percent.
Wacker Chemie gained 2.24 percent, after UBS added the stock to its ''Most Preferred List.''
In Paris, Total closed higher by 0.24 percent. S&P Capital upgraded the stock to ''Strong Buy'' from ''Buy.''
In London, Lloyds Banking climbed by 1.23 percent. Reports said Australia & New Zealand Banking Group Ltd. has dropped out of its $900 million bid for the Australian assets of Lloyds.
Carnival sank by 6.73 percent. The cruise operator was downgraded to ''Underweight'' from ''Overweight'' at Morgan Stanley.
Tesco dropped by 3.50 percent, after JP Morgan downgraded it to "Underweight" from "Neutral."
Utility stocks took a hit after the Labour Party stated that it will freeze prices for gas and electricity for a period of 20 months if it is victorious in the upcoming 2015 election. Shares of Centrica decreased by 5.32 percent and SSE lost 5.76 percent.
Nordea fell by 2.59 percent in Stockholm, after Sweden sold its remaining stake in the lender.
German consumer morale touched its highest level in six years heading into October, as households' outlook of the general economy brightened further, the results of a survey by market research group GfK showed Wednesday.
The forward-looking headline consumer confidence index for October came in at 7.1, up from an upwardly revised 7 for September. Economists had forecast the index to rise to 7 from the 6.9 initially estimated for September.
Confidence in the French industrial sector unexpectedly deteriorated in September, after improving in the previous months, latest data showed Wednesday. The headline industrial confidence index dropped to 97 points in September from 98 points in the previous month, statistical office Insee said. Economists expected the index to rise to 99 points.
Confidence among Italian households increased in September, and to a larger extent than economists had forecast, latest data showed Wednesday. The headline consumer confidence index rose to 101.1 in September from 98.4 in August, which was revised up from 98.3. Economists were looking for a more modest rise to 98.5.
British retailers expect business activity to increase further next month, after recording the strongest growth in fifteen months in September amid broad-based improvement in sales across the main sub-sectors, data from the latest Distributive Traders Survey compiled by the British Chamber of Commerce (CBI) showed Wednesday.
Of the surveyed retailers, 46 percent reported an increase in sales volumes in September, while 12 percent said sales decreased. The resultant balance of 34 percent was the highest since June 2012. The outcome far exceeded the expectations for a balance 26 percent. Sales increased for the third consecutive month.
While the Commerce Department released a report on Wednesday that unexpectedly showed a modest increase in durable goods orders in August, it also showed an unexpected drop in orders when excluding transportation equipment.
The Commerce Department said durable goods orders edged up by 0.1 percent in August after tumbling by a revised 8.1 percent in July. The modest increase surprised economists, who had expected orders to drop by 0.5 percent compared to the 7.4 percent decrease that had been reported for the previous month.
New home sales in the U.S. came in roughly in line with economist estimates in the month of August, according to a report released by the Commerce Department on Wednesday, with sales bouncing well off the previous month's nine-month low.
The report said new home sales jumped 7.9 percent to an annual rate of 421,000 in August from the revised July rate of 390,000. Economists had expected new home sales to climb to 420,000 from the 394,000 originally reported for the previous month.
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