World shares drift as markets mull Fed, China trade talks

Global stock markets were generally lower Thursday as investors analyzed the Fed's decision to keep interest rates unchanged and kept an eye out for developments from China-U.S. trade talks in Beijing.

KEEPING SCORE: In Europe, France's CAC 40 was down 0.3 percent at 5,155 while Germany's DAX fell 0.2 percent to 12,772. Britain's FTSE 100 dipped 0.1 percent to 7,539. Wall Street was set for a flat opening with Dow futures and the broader S&P 500 futures broadly unchanged.

FED STANDS PAT: In leaving rates unchanged, as investors and analysts had expected, the Fed said it expects to continue gradually raising them. The U.S. central bank also said inflation is approaching its 2 percent target after years of remaining undesirably low, though policymakers didn't suggest they're overly concerned that inflation will overshoot that.

TRADE TRIP: A U.S. delegation led by Treasury Secretary Steven Mnuchin arrived in Beijing on Thursday for two days of talks with senior Chinese leaders in an effort to calm worsening friction over the trade imbalance between the world's two biggest economies. Prospects for a breakthrough looked uncertain given the intensifying rivalry over technology that underlies the dispute.

ANALYST TAKE: "European markets were on the back foot in early trade as investors digest the aftermath of the Fed's no-surprise rate hold and U.S.-China trade talks weigh," said Neil Wilson, chief market analyst at Markets.com. "The Fed left rates on hold as expected and signaled that it's unlikely to respond too aggressively if we get some hot summer inflation readings this year."

ASIAN SCORECARD: Hong Kong's benchmark Hang Seng index dropped 1.2 percent to close at 30,313.37 and South Korea's Kospi dipped 0.7 percent to end at 2,487.25. The Shanghai Composite index rose 0.6 percent to 3,100.86 and Australia's S&P/ASX 200 advanced 0.8 percent to 6,098.30.

ENERGY: Oil futures drifted lower. Benchmark U.S. crude fell 6 cents to $67.87 a barrel in electronic trading on the New York Mercantile Exchange while Brent crude, the international standard, was down 39 cents to $72.97 per barrel in London.

CURRENCIES: The euro was up 0.3 percent at $1.1986 while the dollar fell 0.6 percent to 109.21 yen.