Stocks Rebound Ahead of Fed Decision Amid Oil Price Volatility

Global stocks rebounded on Wednesday as recent rises in government bond yields and oil prices paused ahead of a key US Federal Reserve interest-rate decision.

The MSCI's global equities index edged 0.1% higher after falling in the previous two sessions, while an index of Asia-Pacific shares outside Japan climbed 0.6%, snapping a four-day losing streak.

Markets are pricing in a 92.5% probability of a 25-basis-point increase when the Fed announces its decision, according to CME Group's FedWatch tool, up from 61.2% a week ago.

'It's a question of credibility for him to hike right now,' said Michaël Nizard, head of multi-asset and overlay at Edmond de Rothschild Asset Management in Paris. 'If he doesn't hike this evening, it could be a problem for the Fed's credibility, its independence and for the stock market.'

Brent crude futures fell 0.6% to US$108 a barrel after rising 2.9% on Tuesday as reports that Saudi Arabia was offering additional crude cargoes via Oman eased concern about supply disruptions.