US, European stocks rise ahead of Fed announcement

New York - Equities rose on Wall Street and on major European bourses on Tuesday, with US indices finishing at records again, as Congress made progress on the tax cut plan and amid expectations for higher interest rates.

The Dow and S&P 500 ended at all-time highs for the third straight day ahead of Wednesday's expected Federal Reserve interest rate hike.

Outgoing Fed Chair Janet Yellen is slated to speak at a news conference following the announcement, and investors will be watching closely for signals on the timetable for rate hikes in 2018.

Large banks such as Goldman Sachs and Wells Fargo were especially strong on expectations that higher interest rates translate into loftier profits.

The Fed decision comes ahead of meetings later in the week of the European Central Bank and the Bank of England.

US analysts also pointed to signs that key House and Senate Republican lawmakers were nearing agreement on a unified version of the much-anticipated tax cut bill in Congress. Senator John Cornyn, a Texas Republican, said a deal could come as soon as Tuesday, Bloomberg reported.

In Europe, strength in petroleum-linked shares were a factor in gains on major bourses, with Anglo-Dutch giant Royal Dutch Shell and French titan Total advancing.

Oil prices rose early in the session following the shutdown of the Forties pipeline in the North Sea. However, crude prices later sold off amid profit taking and ahead of a US oil inventory report on Wednesday.

US benchmark West Texas Intermediate finished down 85 cents at $57.14 on the New York Mercantile Exchange.

Bitcoin futures for January ended at $18.545 in its second day of trading on the Cboe, declining a bit from Monday's wild opening session.
The Cboe launch Sunday night marked the first opportunity for professional traders to invest in the digital unit on a traditional platform and is expected to be followed in a week by a rival listing on the Chicago Mercantile Exchange.

Among individual stocks aerospace giant Boeing advanced 2.4% after announcing it would increase its dividend by 20% and undertake a new $18bn share repurchase program.

Toy maker Mattel slumped 4.9% as it warned that profit margins would fall in the fourth quarter due in part to weak demand for products and elevated freight and logistics costs.