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Stocks' rate anxiety
Forecast of continued Fed rate hikes into '06 weighs on stock futures ahead of Fed minutes release.
May 24, 2005: 6:08 AM EDT

NEW YORK (CNN/Money) - Renewed concern about rising interest rates could bring an end to stocks' recent rally Tuesday.

U.S. stock futures turned down in early trading, indicating a lower opening for stocks, after the OECD came out with a statement that it sees the Federal Reserve continuing to raise rates into 2006.

The Paris-based think tank also cut its growth forecast for the industrialized world and its chief economist said he saw an increasing risk of a sharp drop in the value of the dollar.

The comments come ahead of the release of minutes of the Fed's May 3 meeting, set for 2 p.m. ET Tuesday. Investors will be looking for further clues as to the thinking of U.S. central bank policy makers about how they weigh the competing risks of inflation and slower economic growth.

While equities turned lower on the OECD forecast, Treasury prices were little changed, leaving the yield on the 10-year note at the 4.05 percent level reached late Monday. The dollar lost ground on the euro and the yen.

Oil prices were lower in early trading Tuesday, after rebounding above the $49 a barrel mark in Monday trading.

The July light crude contract lost 7 cents to $49.09 a barrel in electronic trading, while the July contract for Brent crude slipped 21 cents to $48.16.

Major markets in Asia closed mixed Tuesday. Major European markets were lower in early trading.

For a more detailed look at the markets before the open, click here.  Top of page

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