MARKET SNAPSHOT: U.S. Stock Futures In Holding Pattern As 'historic' Fed Decision Looms
20 September 2017 - 7:58PM
Dow Jones News
By Sara Sjolin, MarketWatch
Dollar drops as traders wait for Federal Reserve call
U.S. stocks' steady rally looks likely to stall somewhat at the
open Wednesday, with traders refraining from making any big bets as
they wait to hear what the Federal Reserve's next move will be.
Stock futures flip-flopped flip-flopped between small gains and
losses in the early going. Futures for the Dow Jones Industrial
Average were up 4 points at 22,340, while those for the S&P 500
index rose 0.30 point at 2,505. Futures for the Nasdaq-100 index
fell 2.25 points to 5,994.75.
The muted action comes after all three main benchmark posted
small gains and ended at all-time highs on Tuesday
(http://www.marketwatch.com/story/us-stocks-aim-for-fresh-records-as-fed-meeting-steals-focus-2017-09-19).
The Dow average climbed 0.2%, while the S&P 500 and Nasdaq
Composite Index both ended 0.1% higher.
"Financial markets are consolidating this morning, with all eyes
on the Fed as the FOMC conclude their two-day meeting with the
announcement of monetary policy," said Richard Perry, market
analyst at Hantec Markets, said in a note.
"This could be a historic meeting today. Even though there is no
expectation of a rate hike, the meeting could include the official
announcement that the Fed will begin to reduce the size of its
balance sheet," he added.
Read:Why stock market investors shouldn't sweat a shrinking Fed
balance sheet
(http://www.marketwatch.com/story/why-stock-market-investors-shouldnt-sweat-a-shrinking-fed-balance-sheet-2017-09-19)
Several central bank officials already wanted to start winding
down the Fed's $4.5 trillion portfolio of government securities in
July, but the majority wanted to hold until a later date. Traders
now expect the Fed on Wednesday to reveal details on a
balance-sheet reduction
(http://www.marketwatch.com/story/feds-balance-sheet-unwind-will-be-moment-of-truth-for-financial-markets-2017-09-18)
that will start in October.
The announcement is due at 2 p.m. Eastern Time, followed by a
press conference with Chairwoman Janet Yellen at 2:30 p.m.
Eastern.
"Any announcement that balance sheet normalization will begin
shortly should have only a relatively muted impact on markets,
given that the market largely expects it," said analysts at
Rabobank in a note.
"We therefore believe that any dollar strength as a result of
the announcement should be limited," they added.
The dollar traded lower against most other currencies ahead of
the announcement. The ICE Dollar Index was down 0.2% at 91.654,
falling for a second straight day.
In other economic news on Wednesday, a reading on existing home
sales for August is due at 10 a.m. Eastern Time. See:MarketWatch's
economic calendar
(http://www.marketwatch.com/economy-politics/calendars/economic)
Stock movers: Shares of American Outdoor Brands Corp.(AOBC)
climbed 1.9% in thin premarket trade, getting a boost from reports
late Tuesday that President Donald Trump will ease rules on gun
exports.
Bed Bath & Beyond Inc.(BBBY) slumped 14% ahead of the bell
after the retailer late on Tuesday released earnings that widely
missed forecasts
(http://www.marketwatch.com/story/bed-bath-beyond-earnings-miss-widely-stock-halted-2017-09-19).
FedEx Corp.(FDX) could also move after the logistics company
late Tuesday reported earnings below forecasts
(http://www.marketwatch.com/story/fedex-shares-down-after-earnings-company-pins-miss-on-cyberattack-hurricane-harvey-2017-09-19),
saying the quarter offered "significantly operational challenges"
due to a cyberattack and Hurricane Harvey.
Other markets: Stocks in Europe were mostly higher, although the
U.K.'s FTSE 100 index
(http://www.marketwatch.com/story/ftse-100-edges-up-as-fed-decision-takes-center-stage-2017-09-20)
underperformed due to a rise in the pound. Sterling strengthened
after U.K. retail sales for August showed a bigger rise than
expected
(http://www.marketwatch.com/story/uk-retail-sales-rise-faster-than-expected-2017-09-20).
Asian stocks closed mixed
(http://www.marketwatch.com/story/asian-markets-press-pause-ahead-of-fed-announcement-2017-09-19)
as traders there remained cautious ahead of the Fed call.
Oil prices rose firmly, while metals gained across the
board.
(END) Dow Jones Newswires
September 20, 2017 05:43 ET (09:43 GMT)
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