Stocks: Wednesday’s review

European stocks closed little changed, after swinging between gains and losses, as investors await tomorrow’s European Central Bank meeting.

Under Draghi’s proposed blueprint, which may be called “Monetary Outright Transactions,” the ECB would refrain from setting a public cap on yields, according to two central bank officials, and a third official, who spoke on condition of anonymity. The plan will only focus on government bonds rather than a broader range of assets and will target short-dated maturities of up to about three years, two of the people said.

National benchmark indexes advanced in 12 of the 18 western-European markets. The U.K.’s FTSE 100 Index fell 0.3 percent. France’s CAC 40 gained 0.2 percent and Germany’s DAX rose 0.5 percent.

Richemont added 1.5 percent to 60.05 Swiss francs after the world’s largest jewelry maker reported revenue that climbed 23 percent in the five months through August as the dollar’s strength boosted the value of sales in that currency.

BP, the owner of the Macondo well that caused the worst U.S. oil spill two years ago, slid 2.9 percent to 423.85 pence after the U.S. Justice Department reiterated it will pursue charges of gross negligence in the case. The company faces a trial with the DOJ after reaching a $7.8 billion settlement in March with victims of the spill.

STMicroelectronics NV declined 4.9 percent to 4.40 euros after UBS AG lowered its recommendation for the biggest European chipmaker to sell from neutral, saying its share price doesn’t take account of continuing challenges to the business. Exane BNP Paribas also downgraded the shares to underperform, the equivalent of a sell rating, from neutral.

Most U.S. stocks fell, sending the Standard & Poor’s 500 Index lower for a second day, amid a slump in FedEx Corp. and disappointing global economic data as investors awaited the European Central Bank’s plan to buy bonds.

ECB President Mario Draghi’s bond-buying proposal involves unlimited purchases of government debt that will be sterilized to assuage concerns about printing money, two central bank officials briefed on the plan said. To sterilize the bond purchases, the ECB will remove from the system elsewhere the same amount of money it spends, ensuring the program has a neutral impact on the money supply.

Draghi told the European Parliament this week that the ECB needs to intervene in bond markets to wrest back control of interest rates in the fragmented euro-area economy and ensure the survival of the common currency. Policy makers start deliberating on the plan today and Draghi will announce whether it has been agreed to at a press conference tomorrow.

Stocks slumped earlier as London-based Markit Economics said euro-area services and manufacturing contracted more than initially estimated in August. Separate data showed service industries in China expanded at a weaker pace in August as new orders slowed and Australia’s economy slowed more in the second quarter than economists expected.

FedEx lost 2 percent to $85.80 for the biggest drop since July 20. The operator of the world’s largest cargo airline said profit for the quarter that ended Aug. 31 will range from $1.37 to $1.43 a share. That was less than its June 19 forecast of $1.45 to $1.60 a share and year-earlier earnings of $1.46. It would mark the first drop in adjusted earnings per share since the quarter that ended November 2009.