Sentiment on Wall Street remains wary on Wednesday, although trading in the major index futures point to a higher open. The catalyst that could define the day's market direction is the Federal Open Market Committee announcement and the ensuing press conference by Chairman Ben Bernanke. Indications from Bernanke that the trimming is something that would happen as the economy steps into a firmer footing could dispel some fears lurking in the minds of traders. That said, the markets have traded up in anticipation of such an outcome and therefore it remains to be seen how much of an impact even a positive announcement can have.
As of 6:15 pm ET, the Dow futures are rising 22 points, the S&P 500 Index futures are adding 3 points and the Nasdaq 100 futures are moving up 9.75 points.
U.S. stocks gained for the second straight day on Tuesday, as the housing starts data was fairly positive and the traders took a positive stance regarding the FOMC decision.
On the economic front, the Energy Information Administration is scheduled to release its weekly oil inventory report for the week ended June 14th at 10:30 am ET.
The Federal Reserve is scheduled to release its post meeting policy statement at 2 pm ET. This will be followed by the release of the FOMC forecasts at 2 pm and Bernanke's press conference at 2:30 pm ET. Bernanke's is expected to reassure the markets, which went about a wild swing in the aftermath of his May 22nd Congressional testimony.
In corporate news, La-Z-Boy (LZB) reported fourth quarter earnings of 33 cents per share on sales of $359.54 million, up 9.8 percent year-over-year. The results exceeded estimates.
Weyerhaeuser (WY) announced that it has priced the public offering of 29 million of its common shares at $27.75 per share, a discount to the $28.24 at which the company's stock closed on Tuesday. The company said it raised gross proceeds of $805 million from the offering. Valeant Pharma (VRX) announced that it would issue 23.53 million shares of its common stock at $85 per share, to raise gross proceeds of $2 billion.
DISH (DISH) said it is impracticable for it table a revised bid for Sprint (S) by the June 15th deadline, as the latter has decided to prematurely terminate the due diligence process and accept an offer from SoftBank.
Symmetricom (SYMM) announced a restructuring plan, which included workforce reduction of about 12 percent, consolidation of several organizations and the elimination of certain activities. The company also lowered its fourth quarter guidance.
Dell (DELL) said a special committee of the board has determined that billionaire investor Carl Icahn's proposal for the company to self tender its shares worth $16 billion is in deviation with his earlier proposal for a buyout at $15 per share. The company said it cannot endorse and execute the proposal in its current state.
Avid Technology (AVID), Clarcor (CLC), Finisar (FNSR), Jabil Circuit (JBL), Micron Technology (MU), Red Hat (RHT) and Steelcase (SCS) are among the companies due to release their quarterly results after the close of trading.
Most Asian markets retreated, as traders lightened holdings ahead of the Fed decision, although the Japanese and Australian markets advanced, the former taking cues from positive domestic data and the latter from the strength in commodity prices.
Japan's Nikkei 225 average ended up 237.94 points or 1.83 percent at 13,245. A majority of stocks advanced in the session, with Kawasaki Kisen, JFE Holdings, KDDI, ITOCHU, Kobe Steel, Sumitomo, Sumitomo Heavy Industries, Sumitomo Mitsui Financial and Furukawa leading the gains. On the other hand, real estate stocks lost ground in the session.
Australia's All Ordinaries closed 47.20 points or 0.98 percent higher at 4,842. The market witnessed broad based strength, with energy, consumer staple and material stocks leading the advance following a rise in commodity prices. Hong Kong's Hang Seng Index languished below the unchanged line throughout the session before closing down 218.57 points or 1.03 percent at 21,007. China's Shanghai Composite closed 0.73 percent lower.
On the economic front, Japan's Ministry of Finance reported that Japan had a trade deficit of 933.92 billion yen in May, not so worse as the 1.22 trillion yen shortfall expected by economists. Exports climbed a solid 10 percent year-over-year, beating expectations for a 6.4 percent increase, while imports also rose 10 percent.
A report released by the Conference Board showed that its leading indicators index for Australia rose 0.3 percent month-over-month in May, marking the fourth straight month of increases. The coincident index also rose 0.3 percent.
European stocks are swinging between gains and losses amid looming uncertainty over Fed policy.
In corporate news, Alcatel-Lucent (ALU) announced that it plans to sell at least 1 billion euros worth of assets. The company also seeks to cut cost by an incremental 1 billion euros. As a strategic decision, the company said it intends to focus on profitable businesses, including ultra-high speed Internet.
Swedish retailer H&M reported a decline in its second quarter profits that trailed estimates by most analysts, hurt by the domestic currency's appreciation, weak demand in Europe among other things.
On the macroeconomic front, the minutes of the Bank of England's most recent policy meeting showed that six members of the monetary policy committee overturned Governor Mervyn King's call for additional stimulus, saying the current policy setting is appropriate. Members said further purchases could lead to an unwarranted narrowing in risk premia and complicate the transition to a more normal monetary policy stance at some point in the future.
Eurozone's construction output increased in April, reversing March's decline, the latest figures from Eurostat revealed. Construction output rose 2 percent in April from the previous month following a 1.8 percent fall in March.
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