European shares slump as investors await dovish Fed speech

European shares traded lower earlier on Thursday, while the Dollar strengthened as investors eyed the Jackson Hole conference where U.S. Fed Chair Jerome Powell will deliver a key speech later in the day.

The pan-European STOXX 600 fell by 0.1%, but still remained close to its two-week high.

Meanwhile, Wall Street saw record highs on Wednesday, with the global MSCI index rising to its highest as large quantities of cheap currencies from central banks helped push big-cap tech companies up.

However, the rally lost momentum during the Asian session after the United States sanctioned China over military action in the disputed South China Sea.

The MSCI world equity index, which tracks shares in 49 countries remained mostly unchanged in the day at 07:23 GMT, while the MSCI’s main European Index lost 0.1%.

Currently, investors are focusing on the Jackson Hole conference, which will be held virtually, as U.S. Fed Chair Jerome Powell is expected to reveal clues of the central bank’s monetary policy around 0910 EDT (13:10 GMT).