With traders reluctant to make any significant moves ahead of the announcement of the Federal Reserve's latest monetary policy decision, stocks are showing a lack of direction in early trading on Thursday. The major averages remain stuck near the unchanged line after opening roughly flat.
Currently, the major averages remain nearly flat, showing moves off less than a tenth of a percent. The S&P 500 is down 0.30 points at 1,436.26, while the Dow is up 1.58 points at 13,334.93 and the Nasdaq is up 1.17 points at 3,115.48.
The choppy trading on Wall Street comes as traders are largely staying on the sidelines ahead of the release of the Fed's monetary policy statement at about 12:30 pm ET.
Many analysts expect the central bank to announce another round of quantitative easing as part of an effort to stimulate the sluggish economy, although others have predicted that the Fed will only extend its pledge to keep interest rates at exceptionally low levels.
A lack of additional stimulus could lead to a sell-off on Wall Street, as stimulus hopes have helped to push the markets higher in recent weeks.
Following the announcement, the Fed will unveil its latest economic forecasts at 2 pm ET, and Fed Chairman Ben Bernanke will hold a press briefing beginning at about 2:15 pm ET.
As a result of the focus on the Fed, traders have largely shrugged off a report from the Labor Department showing a bigger than expected increase in weekly jobless claims.
Labor Department officials noted that the increase in jobless claims was partly due to the impact of Hurricane Isaac, as major storms can often delay unemployment filings.
A separate report from the Labor Department showed that a substantial rebound in energy prices contributed to a bigger than expected increase in producer prices in the month of August.
While most of the major sectors are showing only modest moves in early trading, housing stocks are giving back some ground after moving sharply higher on Wednesday. The Philadelphia Housing Sector Index is down by 1.1 percent, pulling back off yesterday's four-year closing high.
Steel, oil service, and brokerage stocks are also seeing early weakness, while some strength is visible among telecom stocks.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. While Japan's Nikkei 225 Index rose by 0.4 percent, Hong Kong's Hang Seng Index edged down by 0.1 percent.
The major European markets have also turned mixed on the day. The U.K.'s FTSE 100 Index has inched up by 0.1 percent, while the German DAX Index has fallen by 0.6 percent and the French CAC 40 Index has tumbled by 1.3 percent.
In the bond market, treasuries have moved to the upside amid optimism about the possibility of further quantitative easing. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4 basis points at 1.725 percent.
by RTT Staff Writer
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