European and Asian Stocks Extend Declines Ahead of Fed Meeting

LONDON ( The Deal) -- Global stock indices extended declines on Tuesday, with some European indices at a two-week low, as Federal Reserve policy makers prepared to begin a two-day meeting .

With continued geopolitical concerns surrounding the Middle East, Ukraine and a potential "yes" vote on Thursday for Scottish independence, investors remained cautious.

In London, the FTSE 100 was down 0.44% at 6,775.52. In Frankfurt, the DAX was down 0.36% at 9.642.71. The CAC in Paris fell 0.45% to 4,404.39

An index of investors' outlook from Germany's ZEW institute fell less than expected in September but still hit the lowest level since December 2012. Investors' and analysts' assessment of the current situation was worse than forecast.

In the U.K., government figures showed that inflation had slipped to 1.5% in August, as expected, down from a 1.6% rate the month before, though separate figures showed a 11.7% increase in July house prices, countering the perception that Britain's housing boom was abating.

In Madrid, Spanish broadband provider Jazztel  (JAZTF) was up almost 6% after agreeing to a 3.4 billion euros ($4.4 billion) takeover offer from Orange  (ORAN) of France. Jazztel's price held just below the 13 euros per share Orange is offering, suggesting investors think the deal will go through. Also in Madrid, infrastructure and construction company Fomento de Construcciones y de Contratas fell almost 3% after it said it had hired three banks to handle a long-awaited rights issue to cut debt. 

In Paris, Orange dropped just over 1% on news of the Jazztel deal. Advertising giant Publicis Groupe  (PUBGY) rose on news that CEO Maurice Levy will step down after 2016, along with the head of Publicis' Saatchi & Saatchi unit, following the company's failed $35 billion merger with peer Omnicom (OMC) . Publicis didn't name Levy's successor but gave details of an expanded management team which draws on senior executives from the company's various agencies and is designed to help the Paris group increase its digital activities.

In London, shares in online clothing retailer Asos tumbled more than 10% after the company, which offers styles based on celebrity looks, said profit in the year ending August 2015 will probably be flat on the year just ended because of investment in technology, logistics and its international proposition.

Cloud computing company Iomart fell more than 13% after Cinven portfolio company Host Europe Holdings late Monday pulled an indicative offer.

In Tokyo, the Nikkei 225 closed down 0.23% at 15,911.53. In Hong Kong, the Hang Seng tumbled 0.91% to 24,136.01.

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