Premarket: Fed, Europe in focus

Equity investors weighed uncertainty over the future of Europe against prospects that the U.S. Federal Reserve will take steps to deal with a sluggish economy.

Britain's FTSE 100 dipped 0.5 per cent, while France's CAC 40 gained 0.8 per cent and Germany's DAX rose 0.7 per cent. Japan's Nikkei fell 2.2 per cent and Hong Kong's Hang Seng climbed 1.9 per cent.

Dow futures gained 14 points, or 0.1 per cent, lingering near 11,696 about two hours before trading began on Wall Street. S&P 500 futures edged 2.6 points higher, or 0.2 per cent, to 1,227.20.

Greek Prime Minister George Papandreou was due to meet the leaders of France and Germany on Wednesday after his cabinet approved plans to seek a referendum on a rescue package that European governments and lenders agreed upon last week.

Mr. Papandreou also has to survive a confidence vote in parliament on Friday, and some analysts suggested it was speculation that his government will fall that was driving optimism in the stock markets.

The U.S. Federal Reserve is expected to make a policy announcement, which may include its outlook on inflation, unemployment and growth, later on Wednesday.

The euro gained 0.6 per cent, rising to $1.3778 (U.S.).

Benchmark copper on the London Metal Exchange traded up 2.5 per cent at $7,915 a tonne.

U.S. crude oil gained 0.3 per cent, rising to $92.47 a barrel.

Gold firmed as well, rising $19 to $1,730.80 an ounce.

The Canadian dollar rose to 98.25 U.S. cents.