Stocks may show a lack of direction in early trading on Thursday as traders continue to digest yesterday's announcement from the Federal Reserve. The major index futures are currently pointing to a roughly flat open for the markets, with the Dow futures up by just 10 points.
The markets may experience an extension of the choppy trading that was seen following the Fed's latest monetary policy announcement on Wednesday.
As was widely expected, the Fed announced an extension of its "Operation Twist" program until the end of the year. The program had previously been due to expire this month.
"Operation Twist" involves replacing short-term securities in the Fed's bond portfolio with longer-term securities in an effort to push already low long-term interest rates even lower.
At the same time, the Fed generated some negative sentiment by lowering its GDP forecasts, although Fed Chairman Ben Bernanke noted that the central bank is prepared to take additional steps to prop up the sluggish economy.
Traders are also digesting the Labor Department's recently released report on initial jobless claims in the week ended June 16th.
The report showed that jobless claims edged down to 387,000 from the previous week's revised figure of 389,000. Economists had expected claims to dip to 383,000 from the 386,000 originally reported for the previous week.
Additionally, a slew of data is scheduled to be released a half-hour after the start of trading, with traders likely to keep an eye on reports on existing home sales, leading economic indicators, and Philadelphia-area manufacturing activity.
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