European stock markets fell modestly Wednesday after big gains the previous day as investors prepared for the start of the third-quarter corporate reporting season.
The FTSE 100 index of leading British shares was down 21.74 points, or 0.4 percent, at 5,116.24 while Germany's DAX fell 10.81 points, or 0.2 percent, to 5,646.83. The CAC-40 in France was 3.47 points, or 0.1 percent, lower at 3,766.74.
Wall Street was poised for a modestly stronger open after its own hefty advance on Tuesday. Dow industrials futures were up 19 points, or 0.2 percent, at 9,673 while the broader Standard & Poor's 500 futures rose 2.3 points, or 0.2 percent, to 1,050.90.
Investors will be looking to see if the third-quarter earnings season, which kicks off in earnest later with results from aluminum company Alcoa Inc., will provide further evidence that the world economy is poised for a rebound. Financial companies Goldman Sachs, Bank of America, Wells Fargo and industrial conglomerate General Electric are due to report next week.
The second quarter earnings season was generally better than expected and helped fuel a big rise in share prices in July and August. However, the forecast-busting earnings were largely due to cost cutting measures which are unlikely to be repeated.
"A second consecutive strong quarterly season would give investors a reason to continue the rally in equities, moving away from the uncertainty related to the mixed economic data and the focus on policy support," said Steven Goh CEO and Chairman of Takahashi Nakamura in Japan.
On Tuesday, a surprise interest rate hike from Australia's central bank reassured investors that the global economic recovery was continuing. The Reserve Bank of Australia raised its benchmark interest rate by a quarter percentage point to 3.25 percent -- the first hike by a major central bank in the current economic cycle.
