Il Nuovo Postiglione - Equities waver as traders prepare for big week

Asian stocks receded, but, after initial losses, markets in Frankfurt, London and Paris logged modest gains and oil prices advanced.

The Fed is widely tipped to hike borrowing costs by 0.75 percentage points on Wednesday as it battles soaring inflation.

US second-quarter gross domestic product data are due Thursday, with some observers warning it could show a second successive contraction -- which is considered a technical recession.

Investors are also awaiting the release of earnings from business titans Apple, Amazon and Google parent Alphabet.

"Investors start the week with some trepidation, ahead of the latest Federal Reserve decision and a barrage of corporate earnings," said Richard Hunter, head of markets at Interactive Investor.

"With a packed corporate calendar ahead... indices have been unable to shake off recessionary fears."

Markets were roiled last week when the European Central Bank finally began ramping up interest rates to tackle runaway consumer prices in the eurozone.

The ECB had surprised investors on Thursday with a bigger-than-expected rate increase of 0.5 percentage points.

Consumer prices are soaring worldwide after economies reopened from pandemic lockdowns and as the Ukraine war keeps energy prices elevated.

That, in turn, has sparked aggressive rate hikes from major central banks to try and dampen inflationary pressures.

All three main indices on Wall Street ended last week with a loss, ending a three-day rally, following a big data miss on the crucial US services sector.

Federal Reserve chiefs have already said their main priority was bringing inflation down from four-decade highs, even at the expense of growth.

"We still see further downside for risky assets as recession fears accumulate and central banks remain committed to fighting inflation at the expense of growth," said Standard Chartered strategist Eric Robertsen.

Others warned that while inflation could begin to ease, the Fed could still push borrowing costs to around five percent and were unlikely to lower rates as soon as many traders hope.

- Key figures at around 1040 GMT -

London - FTSE 100: UP 0.3 percent at 7,295.67 points

Frankfurt - DAX: UP 0.4 percent at 13,304.60

Paris - CAC 40: UP 0.5 percent at 6,245.59

EURO STOXX 50: UP 0.4 percent at 3,610.69

Tokyo - Nikkei 225: DOWN 0.8 percent at 27,699.25 (close)

Hong Kong - Hang Seng Index: DOWN 0.2 percent at 20,562.94 (close)

Shanghai - Composite: DOWN 0.6 percent at 3,250.39 (close)

New York - Dow: DOWN 0.4 percent at 31,899.29 (close)

Euro/dollar: UP at $1.0220 from $1.0213 Friday

Pound/dollar: UP at $1.2033 from $1.1999

Euro/pound: DOWN at 84.95 pence from 85.11 pence

Dollar/yen: UP at 136.38 yen from 136.12 yen

Brent North Sea crude: UP 1.0 percent at $104.19 per barrel

West Texas Intermediate: UP 1.1 percent at $95.72 per barrel

R.Accetta--INP