Financial markets showed little reaction on Wednesday in expectation of few concrete decisions from the European Union's upcoming debt crisis summit in Brussels later today, analysts said.
European leaders are gathering for the fourteenth crisis summit in 21 months to discuss the Greek debt relief program, recapitalization of banks and the enlargement of Europe's 440 billion euro ($610 billion) rescue fund.
"Today's summit is unlikely to give answers to all the outstanding questions. Most likely, Germany and France as the powers responsible for the anti-crisis plan will outline general areas of work," Invescafe analyst Anna Bodrova said.
"The percentage of the Greek debt write-off is still an unresolved issue. If private investors have to write off over 55 percent of the debt, the market will be swept by a wave of risk aversion. The size of the European Financial Stability Fund (EFSF) and the mechanism for its replenishment and operation have also not been agreed in full," Bodrova added.
The EU countries originally set up the EFSF in May 2010. At an EU summit in July 2011, leaders of the eurozone states decided to enhance the powers of the EFSF by allowing it to buy bonds on the secondary market, recapitalize banks and raise its guarantee commitments to 440 billion euros.
The media reported late on Tuesday that several European countries had reached agreement on a 100 billion euro bank recapitalization and an increase of Europe's bailout fund, Finam Management senior analyst Alexander Osin said.
"In particular, according to information circulating on the market, they plan to create an international fund using the structures of the International Monetary Fund to accumulate funds and invest them in the European bond market," Osin said.
Market activity will be low as market players will be waiting for European leaders to outline their plans at the summit, analysts predicted.
"The concerns that today's EU summit will not offer a long-awaited solution to Europe's financial problems have forced market players to take profit on stock markets. Today European authorities are most likely to announce their action plans to stabilize the financial situation in Europe but specific figures will hardly be made public today," TKB Capital said in a research note.
Uncertainty over the EU debt crisis solutions pushed up gold prices, while commodity prices remained relatively stable.
European stocks showed mixed dynamics by Wednesday's midday trade. London's FTSE rose 0.08 percent to 5,529.94, Germany's DAX went down 0.03 percent to 6,045.16 and France's CAC 40 fell 0.05 percent to 3,172.74. The U.S. Nasdaq fell 2.26 percent to 2,638.42 while Dow Jones lost 1.74 percent to 11,706.62.
Russian stock exchanges are trading in positive territory on Wednesday.
"News from Europe will appear after the close of Russian stock exchanges and hardly any active movement can be expected at today's trading session," TKB Capital said.
The Russian ruble, which has been strengthening against the dollar/euro bi-currency basket in the past few days, fell 7.61 kopecks to 30.57 per dollar in today's trade.
"Generally speaking, today's potential decisions have been priced in the euro rate and I don't expect any considerable fluctuations in the single European currency in the middle of the week. The euro/dollar pair may fluctuate within a narrow range until the end of the week in anticipation of the announcement of the plan's details, but then has the chance of going down as the euro was overbought and investors may be disappointed by EU decisions," Bodrova said.
The ruble is expected to range within 30.45-30.65 per dollar by the end of this week, she added.
