European Shares Seen Lower On AI Spending Jitters

(RTTNews) - European stocks are likely to open lower on Thursday despite the U.S. Federal Reserve delivering a less hawkish outlook than some had anticipated.

Tech shares may face selling pressure after cloud computing giant Oracle's revenues fell short of Wall Street estimates.

Capital spending was significantly higher than expected in Q2 and the company also hiked full-year capex plans, sending its shares down more than 11 percent in extended trading hours.

Asian markets were mixed, giving up early gains amid anxiety about the profitability of artificial intelligence investments.

U.S. bond yields declined after the Federal Reserve moved to ease short-term funding costs. Gold ticked lower as the dollar rebounded slightly from the post-FOMC slump. Oil prices fell after rising on Wednesday following the U.S.'s seizure of a sanctioned tanker off the coast of Venezuela.

Overnight, U.S. stocks closed higher after the Fed cut interest rates by quarter point, matching the rate cuts seen in September and October in another divided vote.

Short-term Treasury yields drifted lower after the Fed said it will launch a $40bn short-term bond-buying program to help manage market liquidity levels and support a softening labor market.

At a news conference following the decision, Fed Chair Jerome Powell said the Fed would have to "wait and see" before making its next move, adding a rate hike isn't in the base case.

Fed members suggested just one further cut in their 2026 central projection, but traders bet risks are skewed towards more cuts.

The Dow rallied 1.1 percent, the S&P 500 added 0.7 percent and the tech-heavy Nasdaq Composite gained 0.3 percent.

European stocks ended mixed on Wednesday as investors waited for the Fed's interest rate decision.

The pan European Stoxx 600 finished marginally higher. The German DAX slipped 0.1 percent and France's CAC 40 dipped 0.4 percent while the U.K.'s FTSE 100 edged up by 0.1 percent.