Europe markets pause as investors eye Fed

European equities are expected to open in negative territory on Tuesday as investors await the outcome of the U.S. Federal Reserve's two-day meeting which begins today.

All eyes are on the U.S. Federal Reserve statement due on Wednesday.

Speculation has mounted that the Fed could drop the word "patience" from its guidance about the pace at which it will normalize monetary policy. Some investors think that interest rates could be increased as early as June.

In Asia, stocks rose on Tuesday, with Tokyo and Shanghai markets clinching new multi-year highs as investors focused on a flurry of central bank meetings. The Bank of Japan left its massive monetary stimulus program unchanged on Tuesday in a widely expected move.

In other news, U.S. oil output could slow by late 2015 due to weak prices, the Organization of Petroleum-Exporting Countries (OPEC) said on Monday, showing no sign in its monthly report that the 12-producer group was about to cut output to prop up oil prices.

It's election day in Israel on Tuesday and polls suggest the race between incumbent Prime Minister Benjamin Netanyahu and Isaac Herzog, the co-head of the Zionist Union coalition. The results could have a knock-on effect on the future of peace talks between Israel and Palestine.

Greece is set to top the agenda at a European Union (EU) summit scheduled for later this week. The European Union's financial affairs chief Pierre Moscovici said on Monday that reaching a funding deal for Greece at the summit depended on whether the Greek government committed to undertaking reforms.