Global markets cautiously await ECB, U.S. data

LONDON A cautious mood prevailed in stock markets Thursday ahead of an interest rate decision by the European Central Bank and key U.S. data that will provide clues on when the Federal Reserve will cut its stimulus.

A string of weak economic figures have raised pressure on the ECB to take action this week but most analysts say it will hold its fire. Even if the bank does not cut interest rates, all eyes will turn to the subsequent press conference by ECB President Mario Draghi for any hints of a move next month.

"There is an expectation that the ECB will open the door to a December ease in the wake of very soft inflation data," said Mitul Kotecha, analyst at Credit Agricole CIB.

Major European benchmarks were muted in early trading. Germany's DAX edged up less than 0.1 percent to 9,045.08 while France's CAC-40 shed 0.1 percent to 4,281.25.

Britain's FTSE 100 fell 0.2 percent to 6,726.44 ahead of a policy decision by the Bank of England. The British central bank is not expected to act, though attention will turn to any statement it puts out alongside its decision.

Futures pointed to a weaker open on Wall Street, where Twitter will start trading following an initial public offeringthat valued the social network at $18 billion. S&P 500 and Dow Jones futures were both down 0.1 percent.

Besides the ECB, investors are waiting for the release of the advance estimate of U.S. third quarter economic growth later Thursday and October jobs figures on Friday.

Both reports could signal how much longer the Federal Reserve will continue its bond purchases at the current rate of $85 billion a month. That program has held down interest rates, kept bond yields low and made stocks more attractive for investors.

Earlier in Asia, Japan's Nikkei 225 shed 0.8 percent to 14,228.44 and Hong Kong's Hang Seng lost 0.7 percent at 22,881.03. China's Shanghai Composite fell 0.5 percent to 2,129.40 and Seoul's Kospi dropped 0.5 percent to 2004.04.

Benchmark crude for December delivery was up 29 cents at $95.12 in electronic trading at the New York Mercantile Exchange. The contract rose $1.43 to close at $94.80 a barrel on Wednesday.

The euro rose 0.1 percent to $1.3520 while the dollar was little changed at 98.68 yen.