European shares drop as focus shifts to cenbank meetings

(Reuters) - European shares dropped on Tuesday, dented by healthcare stocks, with investors refraining from placing aggressive bets anticipating another round of interest rate hikes by major central banks this week.

The pan-European STOXX 600 was down 0.2% at 0816 GMT, but on track to end January on a positive note, buoyed by hopes of better-than-feared corporate earnings and economic resilience.

Rheinmetall AG, which dropped 5% following the launch of a convertible bond offering, was the biggest drag among industrials, while Novo Nordisk AS and AstraZeneca PLc pulled down the healthcare sector.

UniCredit jumped 8.1% to the top of STOXX 600 after the Italian lender pledged to return 5.25 billion euros ($5.69 billion) to investors based on its 2022 results, after posting its best profit in more than a decade.

Shares of UBS Group AG fell 2.6% after the world's largest wealth manager predicted an "uncertain" year ahead.

The U.S. Federal Reserve will kick-off its two-day meet on Tuesday and is widely expected to raise its policy rate by 25 basis points to 4.50%-4.75%.

Meanwhile, the European Central Bank and the Bank of England are seen raising rates by 50 bps each to 2.50% and 4%, respectively, on Thursday.

(Reporting by Ankika Biswas in Bengaluru; Editing by Sherry Jacob-Phillips)