Reuters: Most Read Articles: Euro steadies, shares sag ahead of ECB meeting

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Euro steadies, shares sag ahead of ECB meeting May 2nd 2013, 08:23 Tweet Share this Email Print Related News Oil, stocks fall on weak economic data; Fed stays course Wed, May 1 2013 Companies hire less, manufacturing growth slows in April Wed, May 1 2013 Wall Street drops on data, earnings; Facebook up late Wed, May 1 2013 Fed holds steady on stimulus, worried by fiscal drag Wed, May 1 2013 U.S. dollar falls as data backs loose policy outlook Wed, May 1 2013 Analysis & Opinion Taking stock Deutsche's emerging markets bear sticking to his guns Related Video 2:00am EDT 1 of 4. A man walks through the lobby of the London Stock Exchange August 5, 2011. Credit: Reuters/Suzanne Plunkett By Marc Jones LONDON | Thu May 2, 2013 4:23am EDT LONDON (Reuters) - The euro remained near a two month high and European shares eased on Thursday, as investors waited to see if the European Central Bank will cut rates and hint at more measures to boost struggling eurozone economies. The ECB is expected to react to the recent downturn in even core euro zone countries like Germany by trimming its main interest rate for the first time in 10 months to a new all-time low of 0.5 percent from 0.75 percent in a statement at 1145 GMT (7.45 a.m. ET). But following Wednesday's message from the U.S. Federal Reserve that it could step up its bond purchase programme if required, focus in Bratislava where the ECB meets this month, will be on what else it can do to ease the pressure on the region's struggling economy. Top European shares on the FTSEurofirst 300 .FTEU3 opened down 0.2 percent ahead of the meeting, as London's FTSE 100 .FTSE fell 0.25 percent, Paris's CAC-40 .FCHI dropped 0.3 percent but Frankfurt's DAX .GDAXI edged up 0.1 percent. In the currency market, the euro was beginning to inch back up although mild selling earlier in Asia left it down 0.2 percent for the day and off Wednesday's two-month high at $1.3155 "The central scenario is the main rate being cut to 0.5 percent and its other powder being kept dry for if the economy deteriorates further," said Nick Beecroft, a macro fund manager at Saxo Bank. "That is priced in and the euro may continue higher if that is the case especially in a world where the Fed has opened up the possibility of more easing." Weak manufacturing data out of China had already reinforced doubts over the health of the global economy as had weaker-than-expected ADP jobs figures from the U.S. in the previous session. The HSBC China Purchasing Managers' Index dropped to 50.4 in April from March's 51.6 and a tad below a flash reading of 50.5, as new export orders fell for the first time this year. That had weighed Australia's shares and currency while also hitting Chinese shares and oil and copper prices. <O/R><MET/L> Back in Europe's bond market, focus remained squarely on what the ECB would do with rates with expectations for a cut underpinning demand for the already ready rock bottom yields offered by German government bonds. (Editing by Philippa Fletcher) Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (1) No worries. The ECB will lower rates to zero, and take a 25% cut off the top of accounts above 100,000 EU for good measure. May 02, 2013 1:04am EDT  --  Report as abuse See All Comments » Add Your Comment

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