(RTTNews) – After falling sharply over the previous two sessions, stocks may show lack of direction early in Wednesday’s session. Major index futures are currently pointing towards a roughly stable opening for the markets, with S&P 500 futures only rising by one point.
Traders may be reluctant to take any significant action ahead of the much-anticipated Federal Reserve monetary policy announcement this afternoon.
With recent data showing inflation at consistently high levels, the Fed should significantly accelerate its schedule of reducing bond purchases.
Reports suggest the Fed may double the rate of reduction of its asset purchases to $ 30 billion per month, from $ 15 billion per month announced at its previous meeting in November.
Many traders expect the Fed to start raising interest rates soon after stopping its asset purchase program next year.
Reflecting the focus on the Fed, traders largely ignored some key US economic data, including a Commerce Department report showing retail sales rose much less than expected in November.
The Commerce Department said retail sales rose 0.3% in November after climbing a revised upward rate of 1.8% in October.
Economists expected retail sales to rise 0.8% from the 1.7% peak initially reported for the previous month.
Excluding sales by motor vehicle and parts dealers, retail sales rose another 0.3% in November after jumping 1.8% in October. Non-auto sales are expected to jump 1.0%.
Meanwhile, the Labor Department released a report showing that U.S. import prices rose in line with economists’ estimates in November.
The Federal Reserve Bank of New York also released a report unexpectedly showing a modest acceleration in the pace of growth in regional manufacturing activity in December.
After the sharp decline observed on Monday, equities suffered a further decline during Tuesday’s session. With the decline, the S&P 500 continued to lose ground after ending last Friday’s trading at a higher closing high.
Major averages came out of their worst levels of the day well but remained in negative territory. The Dow Jones lost 106.77 points or 0.3% to 35,544.18, the Nasdaq fell 175.64 points or 1.1% to 15,237.64 and the S&P 500 slipped 34.88 points or 0.8% to 4,634.09.
In overseas trading, stock markets in the Asia-Pacific region posted mixed performance in Wednesday’s session. Japan’s Nikkei 225 index rose 0.1%, while the Chinese Shanghai composite index fell 0.4%.
Major European markets also turned mixed that day. While the UK FTSE 100 index is down 0.2%, the German DAX index is up 0.4% and the French CAC 40 index is up 0.6%.
In commodities trading, crude oil futures fell $ 0.80 to $ 69.93 per barrel after falling $ 0.56 to $ 70.73 per barrel on Tuesday. Meanwhile, an ounce of gold is trading at $ 1,772, down $ 0.30 from the previous session’s close of $ 1,772.30. Gold slipped $ 16 on Tuesday.
On the currency front, the US dollar is trading at 113.85 yen against 113.70 yen at the close of the New York Stock Exchange on Tuesday. Against the euro, the dollar is trading at $ 1.1269 against $ 1.1259 yesterday.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.