After moving notably higher over the two previous sessions, stocks may show a lack of direction in early trading on Wednesday. The major index futures are currently pointing to a roughly flat open for the markets, with the Dow futures down by just 10 points.
Traders may be reluctant to make significant moves ahead of the Federal Reserve's highly anticipated monetary policy announcement this afternoon.
With the Fed widely expected to slow the pace of interest rate increases to 50 basis points, traders are likely to pay close attention to the accompanying statement for clues about the outlook for future rate hikes.
Recent data showing a slowdown in the pace of price growth has led to some optimism the Fed will not raise rates as high as previously feared.
The Fed is not likely to make any solid commitments, however, as a slew of key data will be released before the next monetary policy meeting in late January/early February.
On the U.S. economic front, the Labor Department released a report showing import prices declined for the fifth consecutive month in November.
The Labor Department said import prices slid by 0.6 percent in November after falling by a revised 0.4 percent in October.
Economists had expected import prices to decrease by 0.5 percent compared to the 0.2 percent dip originally reported for the previous month.
Meanwhile, the report said export prices fell by 0.3 percent in November following a revised 0.4 percent drop in October.
Export prices were expected to decrease by 0.4 percent compared to the 0.3 percent decline originally reported for the previous month.
Stocks gave back ground after an early rally on Tuesday but managed to finish the day mostly higher. The major averages added to the strong gains posted on Monday, further offsetting the steep drop seen last week.
After soaring by more than 700 points in early trading, the Dow briefly dipped into negative territory before closing up 103.60 points or 0.3 percent at 34,108.64. The Nasdaq jumped 113.08 points or 1.0 percent to 11,256.81, while the S&P 500 climbed 29.09 points or 0.7 percent to 4,019.65.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index advanced by 0.7 percent, while Hong Kong's Hang Seng Index rose by 0.4 percent.
Meanwhile, the major European markets have moved to the downside on the day. While the German DAX Index has slid by 0.7 percent, the French CAC 40 Index is down by 0.4 percent and the U.K.'s FTSE 100 Index is down by 0.2 percent.
In commodities trading, crude oil futures are climbing $0.77 to $76.16 a barrel after jumping $2.22 to $75.39 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,819.80, down $5.70 compared to the previous session's close of $1,825.50. On Tuesday, gold surged $33.20.
On the currency front, the U.S. dollar is trading at 135.07 yen compared to the 135.59 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0640 compared to yesterday's $1.0633.
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