(Reuters) – European shares slipped on Wednesday, a day after strong gains on Germany’s approval for a massive spending surge, while focus shifted the U.S. Federal Reserve’s interest rate decision.
The pan-European STOXX 600 was down 0.3%, as of 0813 GMT, while Germany’s blue-chip index fell 0.5%.
German equities had jumped on Tuesday after the country’s parliament approved plans for a massive spending surge to revive economic growth and scale up military spending.
European aerospace and defence index, the beneficiary of higher defence spending prospects, jumped 0.7% to a record high.
Long-term growth prospects from fiscal reforms also enabled Barclays to raise its year-end target for the STOXX 600 index.
Meanwhile, the Fed is widely expected to keep rates on hold later in the day. A similar move is also expected from the Bank of England on Thursday.
Basic resources led losses among sectors, falling 0.7%, followed by European banks, which lost 0.5% after closing at an all-time peak in the prior session.
In other stocks, Traton dropped 6.3% after its parent Volkswagen said it had sold a 2.2% stake in the truckmaker for 360 million euros ($393 million).
(Reporting by Nikhil Sharma; Editing by Rashmi Aich)
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