US stocks higher as investors await Fed policy meeting, possible reining in of low interest rates
Fed could lay the groundwork for an announcement of a pullback in November
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U.S. equity futures were trading higher early Wednesday as investors await a Fed policy meeting later in the day where Fed governors may signal when they will begin reining in ultra-low interest rates policies.
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The Fed could lay the groundwork for an announcement of a pullback in November, the first step toward unwinding the extraordinary support given to the economy since the pandemic struck 18 months ago.
Global investors also are watching nervously as Evergrande, one of China’s biggest real estate developers, faces a possible default on tens of billions of dollars of debt, fueling fears of possible wider shock waves for the financial system.
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Chinese regulators have yet to say what they might do about Evergrande Group. Economists expect them to intervene if Evergrande and lenders can’t agree on how to handle its debts. But any official resolution is expected to involve losses for banks and bondholders. The company said it plans to make an interest payment Thursday.
"Although the banks are yet to declare Evergrande in technical default, the silence from Beijing is adding to market nervousness," Venkateswaran Lavanya of Mizuho Bank said in a commentary.
U.S. equity futures rose were trading higher early Wednesday as investors await a Fed policy meeting later in the day where Fed governors may signal when they will begin reining in ultra-low interest rates policies. (AP Photo/Richard Drew) (AP Photo/Richard Drew / AP Newsroom)
On Tuesday, nerves appeared to steady after a selloff on Monday.
The S&P 500 fell 3.54 points to 4,354.19, while the Dow Jones Industrial Average dropped 50.63 points to 33,919.84. The Nasdaq composite rose 0.2% to 14,746.49.
Small-company stocks also managed gains. The Russell 2000 index rose 0.2% to 2,186.18.
Supply chain problems, which have been hurting a broad range of industries, weighed on several companies. Homebuilder Lennar fell 0.5% after home deliveries for the third quarter fell short of analysts' forecasts because of supply chain problems.
In Asia, shares were mixed in Asia on Wednesday as investors awaited the Federal Reserve’s latest assessment on the U.S. economy.
Tokyo fell but other major regional benchmarks were mostly higher on Wednesday, trimming early losses.
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The Bank of Japan kept its ultra-supportive monetary policy unchanged, as expected.
Tokyo's Nikkei 225 index lost 0.5% to 29,690.31, while the Shanghai Composite index gained 0.3% to 3,625.32. Australia's S&P/ASX 200 gained 0.6% to 7,319.40. Shares fell 2% in Taiwan and also declined in Singapore. But benchmarks rose in India, Indonesia and Malaysia.
Markets in South Korea and Hong Kong were closed for holidays.
Universal Music jumped 35.7% in its debut on Amsterdam's stock exchange.
In other trading, U.S. benchmark crude oil picked up 92 cents to $71.41 per barrel in electronic trading on the New York Mercantile Exchange. It gained 35 cents to $70.49 on Tuesday.
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Brent crude oil, the standard for international pricing, added 93 cents to $75.29 per barrel.
The U.S. dollar rose to 109.52 Japanese yen from 109.23 yen late Tuesday. The euro was unchanged at $1.1726.