Stock futures little changed Wednesday before Fed decision

AUG 12, 2009
Stock futures are little changed Wednesday ahead of a key Federal Reserve Board meeting, and a day after the market posted its biggest losses in five weeks. Overseas, Asian markets fell amid fresh worries about the speed of economic recovery in China, while European markets were modestly higher. Investors have put a summer rally on hold as they search for fresh signs the economy is strengthening and pulling out of its recession. The latest assessment on how the economy is faring will come from the Fed, which wraps up a two-day meeting Wednesday afternoon. It is widely expected that the central bank will hold its key interest rate at a historic low near zero percent. With rates unlikely to change, investors will be looking to see what the Fed says about the economy in its statement that accompanies the rate decision. Ahead of the opening bell, Dow Jones industrial average futures fell 3, or 0.03 percent, to 9,213. Standard & Poor's 500 index futures declined 0.20, or 0.02 percent, to 992.70, while Nasdaq 100 index futures rose 1.25, or 0.2 percent, to 1,597.75. The market is looking to bounce back a day after posting its biggest loss in five weeks. The Dow fell 1 percent on Tuesday, while the S&P dropped 1.3 percent. With little new economic or earnings data to spur stocks higher, investors paused in their recent buying to book some gains. Uncertainty around the Fed's meeting also provided a time for investors to pause. Meanwhile, bond prices were little changed ahead of an auction of $23 billion in 10-year Treasury notes. The Treasury Department is auctioning a record $75 billion in debt this week. Investors will keep a close eye on demand for the debt because a drop in buyers could force the government to increase the interest it pays, which would drive up borrowing costs for consumers and slow an economic recovery. The yield on the benchmark 10-year Treasury note, which moves opposite its price, was flat at 3.67 percent compared with late Tuesday. Bond prices rose Tuesday as traders moved out of stock and into safer investments like government bonds. The dollar mostly fell against other major currencies, while gold prices also fell. Overseas, Japan's Nikkei stock average fell 1.4 percent. In afternoon trading, Britain's FTSE 100 rose 0.3 percent, Germany's DAX index rose 0.6 percent, and France's CAC-40 gained 0.2 percent.

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