US: Wall St little changed ahead of Fed statement

[REUTERS] US stock indexes were little changed on Wednesday as investors awaited the outcome of a Federal Reserve meeting on monetary policy.

While the central bank is expected to leave interest rates unchanged, investors will keep a close eye on its commentary for clues on the path of future hikes.

A report by the Labor Department showed core consumer price index (CPI), which excludes energy and food prices, rose more than expected in February. The improvement is likely to bolster the Fed's case for tightening monetary policy.

Economists polled by Reuters are looking at two possible rate hikes in 2016, but financial markets are pricing in only one hike of 25 basis points.

Financial markets have recovered from a heavy selloff in the first two months this year, but remain cautious as improving conditions could push the Fed to tighten its policy sooner than expected. "We've got some first-tier economic data (today) that is going to be analysed, but largely ignored," said Alan Gayle, senior investment strategist at RidgeWorth Investments in Atlanta. "I suspect that traders are going to wait on the sidelines for the Fed results," Gayle said.

Global markets dipped ahead of the Fed statement, which is expected at 2 pm ET (1800 GMT). Fed Chair Janet Yellen is scheduled to hold a press conference at 2:30 p.m.

At 9:37 am ET, the Dow Jones industrial average was down 16.37 points, or 0.09 per cent, at 17,235.16, the S&P 500 was down 1.58 points, or 0.08 per cent, at 2,014.35 and the Nasdaq Composite was down 5.94 points, or 0.13 per cent, at 4,722.73.

Seven of the 10 major S&P sectors were lower. The rate-sensitive utilities sector was down 0.84 per cent, followed by a 0.5 per cent fall in consumer staples.

The S&P energy gained 0.8 per cent, as crude prices rose about 2 per cent after major producers agreed to meet next month to discuss freezing output, fuelling hopes of measures to tackle a global glut.

In US corporate news, shares of Oracle were up 4.7 per cent at US$40.57 after the enterprise software company's quarterly profit beat estimates.

Chipotle Mexican Grill was down 5.3 per cent at US$476.10 after warning that it will post its first quarterly loss as a public company.

LinkedIn was down 4 per cent at US$110.91 after Morgan Stanley downgraded the stock to "equalweight".

Gap fell 2.7 per cent to US$28.94 after Morgan Stanley cut its rating on the stock to "underweight".

Declining issues outnumbered advancing ones on the NYSE by 1,401 to 1,202. On the Nasdaq, 1,168 issues fell and 932 rose.

The S&P 500 index showed two new 52-week highs and two new lows, while the Nasdaq recorded seven new highs and 12 lows.

REUTERS