(Updates throughout ahead Wall Street open, adds details on

Swedish and Canadian central bank decisions)

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Investors wait for Fed signals after rollercoaster few

days

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Microsoft ( MSFT ), Meta and Tesla reporting results later

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Europe hits record high after China AI-driven volatility

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Czech central bank wants a bitcoin stash

By Marc Jones

LONDON, Jan 29 (Reuters) - World markets were suddenly

looking calmer on Wednesday as the week's rollercoaster ride for

stock markets morphed into wait-and-see ahead of the Federal

Reserve's first rate meeting of the year and results from

Microsoft ( MSFT ), Meta and Tesla .

The Fed is widely expected to end a three-meeting run of

rate cuts later and stay on hold, but investors will be eager to

get a sense of just what it makes of new U.S. President Donald

Trump's eventful first nine days back in charge.

There was plenty to be getting on with before that though.

European shares climbed to a record high as strong results

from Dutch chip equipment maker ASML sent its stock

soaring nearly 11% and hoisted the wider tech sector up

4.5%.

The parts of Asia that were not on Lunar New Year holidays

had gained overnight too and Wall Street futures were on up

again too ahead of the trio of "Magnificent 7" earnings..

Investors seemed to have papered over the global rout

suffered on Monday when the emergence of lower-cost Chinese AI

model, DeepSeek, wiped more than half a trillion dollars off

Nvidia's ( NVDA ) value alone.

More than half of that has now been recouped though and with

the Fed also looming on the horizon, currency and bond markets

were mostly in a holding pattern.

The 10-year U.S. Treasury yield was at 4.52%, 3 bps lower on

the day. European yields dipped with the ECB expected to cut its

rates again on Thursday, while the yen nudged higher

to 155.37 per dollar after Bank of Japan meeting minutes pointed

to more rate hikes there.

State Street's head of global macro strategy Michael

Metcalfe said that after all the recent market dramas, Wednesday

was, in theory, going to have some much-needed predictability.

"Today is one day of certainty in that we know the Fed won't

move rates," he said.

Despite the noise around Trump trade tariffs, State Street

expects Fed chief Jerome Powell to maintain the message that

rates are likely to keep falling, while the return of calm in

stock markets was also a positive.

"Two days in and it doesn't look like there is broader

contagion," Metcalfe said.

BIG TECH EARNINGS

Nasdaq futures pointed 0.2% higher following its 2%

rebound on Tuesday while Nvidia's ( NVDA ) Frankfurt listed shares had

recouped another 2% during their morning.

Attention is now on the mega-cap tech earnings due from

Facebook owner Meta, Microsoft ( MSFT ) and Tesla after the closing bell

on Wednesday.

"While questions remain unanswered, the market is voting

that the innovation that DeepSeek could bring to the ecosystem

will unlikely impact the AI capex cycle and could even lead to

new channel of demand for GPUs (graphics processing units),"

Pepperstone strategist Chris Weston said.

Traders were also digesting Trump's latest tariff threats.

The White House said he still planned to hit Mexico and

Canada with steep tariffs on Saturday and that he was "very

much" considering some on China at the weekend.

There was not much reaction from the Mexican peso. It

edged up slightly to 20.52 per dollar, while Canada's currency

was a touch weaker at C$1.44. Its central bank is

expected to cut rates by another a quarter point later.

Sweden's Riksbank had already got that ball rolling. It cut

its main rate by a quarter point to 2.25% - its fifth cut in a

row and the sixth since May last year. The crown brushed

off the expected move, however.

Oil prices eased slightly, with Brent crude oil futures

dipping to $77.18 per barrel, taking its drop over the

last 12 days to nearly 7%. U.S. West Texas Intermediate crude

sagged to $73.39 after a similar slide.

The day's crypto action meanwhile came from the Czech

Republic where its central bank Governor Ales Michl said in an

interview with the Financial Times he would present a plan to

the bank's board on Thursday to buy bitcoin.

He added that, if approved, the bank could eventually hold

as much as 5% of its 140 billion-euro ($146.13 billion) reserves

in the cryptocurrency.