Global shares, oil steady before U.S. data, Fed meeting
By Richard Hubbard
LONDON (Reuters) - European shares consolidated near two-year highs on Tuesday and oil prices steadied as investors seeking evidence of a lasting economic recovery awaited U.S. data and a Federal Reserve policy decision later in the week.
U.S. stock futures signaled Wall Street would probably open lower before a series of earnings reports, although the S&P 500 index .SPX had held above the 1,500 point level on Monday, suggesting there was still support for the market. .N
Accommodative monetary policies by the world's major central banks, signs of an end to the euro zone crisis and solid corporate results have spurred investors back into riskier assets this year, despite expectations of modest global growth.
Analysts believe the current pause is likely to be only temporary given the demand by investors for higher returns after years of holding safe but low yielding assets.
"The markets are currently overbought after one of the longest winning streaks in years and we are due for a period of consolidation. This will probably not be too violent as there is a lot of money waiting at the sidelines," Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets, said.
Gains across Asian markets on Tuesday, led by a big rally in Australian shares, helped to lift MSCI's world equity index .MIWD00000PUS by 0.15 percent to near a 20-month high.
The FTSE Eurofirst 300 index .FTEU3 of top European shares was virtually flat, although it hit a 23-month high on Monday. Share markets in London .FTSE, Paris .FCHI and Frankfurt .GDAXI were flat to slightly lower.
Peter Sullivan, head of European Equity Strategy at HSBC, said the past 9 weeks have seen steady equity inflows from retail investors after four years dominated by outflows. Continued...