Global stocks struggle as ECB and OPEC meetings loom

Global stock markets made little headway on Thursday as Japan's Nikkei fell sharply following a jump in the yen while European markets were flat in the run-up to a key European Central Bank (ECB) meeting.
Along with the ECB, an OPEC meeting in Vienna was also at the forefront of investors' minds, with oil prices holding steady as analysts said they did not expect the meeting to result in restrictions on crude oil output.

The MSCI All-Country World index slipped 0.1 percent while the pan-European STOXX 600 and FTSEurofirst 300 indexes were flat.

Japanese stocks had earlier suffered their biggest daily percentage drop in a month on Thursday, hit by a move higher for the yen on currency markets.

Keeping interest rates firmly on hold, the ECB will probably raise growth and inflation forecasts on Thursday, a rare positive step even as it emphasises persistent negative risks and a readiness to provide more stimulus.

Although the ECB will maintain its guidance that rates will stay at their current or lower levels for an extended period, Draghi may repeat his view that he does not foresee another rate cut.

Speculation that the ECB could raise its growth and inflation forecasts supported the euro currency on foreign exchange markets.

Nevertheless, some traders said a lack of new, concrete measures from the ECB and OPEC meetings could disappoint some investors.

"The ECB and OPEC meetings could prove to be a damp squib, which may result in markets drifting a bit lower," said Terry Torrison, managing director at Monaco-based McLaren Securities.

On the bond markets, Greek government borrowing costs hovered near six-month lows on speculation that the ECB meeting could signal the return of a funding lifeline to Greece's banks, the first step in its plans to return to bond markets next year.

However, sterling remained under pressure due to lingering uncertainty over the result of this month's 'Brexit' vote on whether or not Britain will choose to remain a member of the European Union.

"We are monitoring risk due to things like Brexit, but from a valuation point of view we like Europe," said Bill Street, EMEA head of investments at State Street Global Advisors.