European stocks turn negative as earnings, Fed decision hold spotlight; Novartis falls 3%

LONDON — European stocks were lower on Tuesday as global markets await the U.S. Federal Reserve’s interest rate decision.

By 8:58 a.m. in London (4:58 a.m. ET), the pan-European Stoxx 600 was trading 0.2% lower, with most sectors and major bourses trading in negative territory. Bucking the trend was the utilities sector, often seen as a somewhat stable investment amid market volatility.

The moves on Tuesday marked a reversal from the previous session, which saw stocks

The big event for investors this week is the Fed’s two-day meeting, which begins on Tuesday. The market is now pricing in a 96% chance that the U.S. central bank will announce a 25 basis-point rate cut this week, according to the CME Fedwatch tool.

Traders are also hoping for a signal from Fed Chair Jerome Powell on Wednesday that the central bank will cut once more at its final meeting of the year in December, given concerns about a weakening labor market.

The Fed is dealing with an economic data blackout given the ongoing U.S. government shutdown, with last week’s inflation report one of the few data pieces to be released recently.

— CNBC’s Pia Singh and Hugh Leask contributed to this market report.