LONDON — European stock markets made modest gains in late-morning trading on Wednesday, ahead of the U.S. Federal Reserve’s decision on interest rate policy.

The DAX in Frankfurt was up 0.8 percent to 10,537.22, followed by the FTSE 100 in London and the CAC 40 in Paris, both of which were up 0.7 percent — to 6,062.33 and to 4,647.17 respectively. The FTSE MIB in Milan climbed 0.4 percent to 21,351.98.

The euro traded at $1.10 while the pound fetched $1.51 and the Swiss franc equaled $1.01 at 13:15 CET. The Hong Kong dollar bought $0.13.

Retail and luxury stocks were also on the upswing, with the morning’s biggest risers including Swatch Group, 1.5 percent to 64.40 Swiss francs; Safilo Group, 2.1 percent to 10.39 euros; Mulberry Group, 1.4 percent to 9.23 pounds, and Metro AG, 1.3 percent to 28.61 euros.

Among the stocks that lost the most ground were Prada, which is quoted on the Hong Kong stock exchange. Shares were down 7 percent to 24.75 Hong Kong dollars after the group reported a 26.3 percent drop in net earnings for the nine months ended Oct. 31, including a continued steep decline in sales of its core leather goods.

French Connection fell 4.3 percent to 0.37 pounds; Koovs.com, 2.7 percent to 0.27 pounds; Asos.com, 2.9 percent to 33.68 pounds; Gemfields, 3.8 percent to 0.39 pounds, and Britain’s Bonmarche Holdings, 28.9 percent to 2.12 pounds.

Later today, the U.S. Federal Reserve is set to raise interest rates for the first time since 2006, and set out the pace of the rises over time. The interest rate hike has long been expected, and is a sign that the U.S. economy has begun to gain steam.

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