Luxury stocks drag European equities lower ahead of Fed meeting

European shares opened lower on Wednesday, weighed down by a sell-off in luxury stocks after a sales warning from Kering, while investors remained cautious on concerns the U.S. Federal Reserve could signal a slower path of rate cuts this year. The pan-European STOXX 600 index was down 0.2%, as of 0806 GMT.

European shares opened lower on Wednesday, weighed down by a sell-off in luxury stocks after a sales warning from Kering, while investors remained cautious on concerns the U.S. Federal Reserve could signal a slower path of rate cuts this year.

The pan-European STOXX 600 index was down 0.2%, as of 0806 GMT. The personal and household goods index fell 1.6%, leading sectoral declines after luxury goods group Kering warned its first-quarter sales are likely to drop by around 10%, weighed down by star label Gucci due to weakness in Asia.

In a sector-wide reaction, other luxury stocks such as LVMH, Burberry, Richemont, and Christian Dior dropped between 3% and 4.9%. Later in the day, investors will look out for Italy's January industrial output data, along with the eurozone consumer confidence survey for March.

Still, the main focus remains on the Fed's monetary policy meeting, where the U.S. central bank could offer insights into its outlook on interest rate cuts later in the day. Shares of Lonza rose 4.8% after the Swiss contract drug manufacturer agreed to buy Roche's Genentech manufacturing facility in California for $1.2 billion in cash.