European stocks edged higher on Tuesday (December 9th) as global investors awaited the US Federal Reserve's monetary policy update.

The pan-European Stoxx 600 index rose 0.17% at the opening bell. The Fed is widely expected to cut its benchmark interest rate at its final meeting of the year. Currency markets are currently pricing in an 87% chance of a quarter-point rate cut when the central bank concludes its two-day meeting on December 10th, according to the CME FedWatch tool.

This move will serve as a benchmark for central banks in Europe, with the Swiss National Bank due to deliver its own policy update on Thursday. The Bank of England and the European Central Bank will follow suit on December 18th, with Norway's Norges Bank and Sweden's Riksbank also scheduled to announce their interest rate decisions on the same date.

In corporate news, the European Union announced on Tuesday that it had reached an agreement to "simplify" corporate sustainability laws. Under the updated system, most companies in the European Union will be exempt from sustainability reporting obligations.

"Today we are fulfilling our promise to remove burdens and regulations and increase the competitiveness of the European Union," said Marie Bjerre, Denmark's Minister for European Affairs, in a statement. "This is an important step towards our shared goal of creating a more conducive business environment to help our companies grow and innovate."

Investors were also digesting comments from US President Donald Trump, who said on Monday that the US would allow Nvidia to ship its H200 AI chip to "approved customers" in China—if America received a 25% cut of the sales.

Elsewhere, Deutsche Bank downgraded automotive giant Volvo from Buy to Hold on Tuesday, lowering the company's price target by 1.8%. Its shares fell 1.3% early in the deal.

Deutsche Bank also lowered its price target on Daimler Trucks by 4.7%.

"The significant contraction of the US market this year is once again testing the resilience of truck manufacturers," the investment bank's strategists said in a note. "Given the diverse market outlook for the coming year, we expect the US to continue to be a crucial competitive battleground."

On Monday, Magnum Ice Cream Company debuted on the Amsterdam stock exchange, completing its separation from consumer goods giant Unilever.

The stock gained slightly during the trading session. Tuesday will see the release of data on German exports, Dutch inflation, and UK retail sales.

Overnight in Asia, stocks were generally lower, while US stock index futures were last seen flat. (alg)

Source: CNBC.com