(Reuters) – Wall Street’s main indexes were set to eke out gains at open on Wednesday, as investors cautiously waited for more clarity on the Federal Reserve’s monetary policy outlook for the year, while trade worries still lingered.
FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., March 13, 2019. REUTERS/Brendan McDermid
The U.S. central bank is largely expected to keep the fed funds rate steady and lower the number of hikes forecast for 2019 as it wraps up a two-day policy meeting, followed by a statement at 2 p.m. ET and a press conference by Fed Chairman Jerome Powell half an hour later.
The policy statement will also shed light on long-awaited details regarding the Fed’s plans to stop reducing its holdings of Treasury bonds.
“It’s a Fed day and investors will scrutinize its communiqué with two key factors — the duration of patience and the overall outlook on the economy,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“We believe the Fed will not surprise the markets but add another caveat, a trade deal, to data dependence and patience.”
Citigroup Inc dipped 0.2 percent in premarket trade, while Bank of America Corp edged down 0.1 percent.
Optimism that the Fed will remain patient in raising borrowing costs and hopes that United States and China will resolve their trade spat helped U.S. stocks erase most of their losses from late last year.
Following a 13 percent rally this year, the benchmark S&P 500 now remains 3.5 percent away from its record closing high in September.
At 8:13 a.m. ET, Dow e-minis were up 0.12 percent. S&P 500 e-minis were up 0.07 percent and Nasdaq 100 e-minis were up 0.10 percent.
The three main indexes ended mixed on Tuesday following a report that U.S. was concerned China was pushing back against American demands in the trade talks. News that the world’s biggest economies will reconvene face-to-face negotiations next week, did little to support the market.
“It was pretty much given that only a negative surprise was going to have an impact on the markets, when it comes to the trade negotiations saga, because all the positive aspect was already priced in,” Aslam said.
Among other stocks, FedEx Corp slipped 6.5 percent after the package delivery company cut its 2019 profit forecast for the second time partly blaming slowing global trade growth.
The results pushed United Parcel Service Inc down 2.1 percent.
General Mills Inc jumped 4.4 percent after the Cheerios cereal maker raised its full-year forecast, benefiting from its efforts to cut costs and raise prices.
Shares of fellow packaged food companies Kellogg Co rose 1.1 percent, while Kraft Heinz Co gained 0.8 percent.
Reporting by Medha Singh and Shreyashi Sanyal in Bengaluru; Editing by Shounak Dasgupta
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