Stocks get GDP lift

NEW YORK (CNNMoney.com) -- Stock futures pointed to a lower Wednesday open, but they were up from the lows after a better-than-expected fourth-quarter GDP reading, in a busy session that includes the Federal Reserve's decision on interest rates.

At 8:56 a.m. ET, Nasdaq and S&P futures were lower.

Futures moved off their lows after the government reported that the pace of U.S. economic growth picked up in the fourth quarter, expanding at an annual 3.5 percent rate, according to the government's first reading for the period. That compared to 2 percent growth seen in the third quarter.
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Economists surveyed by Briefing.com had forecast a 3 percent pace of growth in the fourth quarter.

Treasury prices slipped into negative territory on the reading, as the 10-year note yield rose to 4.90 percent from 4.87 percent late Tuesday.

But investors were eagerly awaiting for the second big event of the day - the Federal Reserve's statement from its two-day policy meeting. The central bank is widely expected to leave rates unchanged for the fifth straight meeting, but economists and traders will be examining the statement when it's released at 2:15 p.m. ET for clues as to when and in what the direction the Fed may move rates in the future.

Media conglomerate Time Warner (Charts), the parent company of CNNMoney.com, was one of the first companies to report before the bell Wednesday, as its fourth-quarter results and 2007 guidance met Wall Street expectations.

Also due before the opening bell earnings from Dow components Altria (Charts) and Boeing (Charts). Search leader Google (Charts) is set to report after the close.

Oil eased a little ahead of the 10:30 a.m. ET report on U.S. fuel inventories, following Tuesday's big runup. U.S. light crude slipped 27 cents to $56.70 a barrel in electronic trading.

Stocks in Asia closed mostly lower in Wednesday trading, while major markets in Europe also lost ground in early trading. The dollar was stronger against the euro but lower versus the yen in early trading.

Among stocks in the news overnight, Allstate (Charts) posted a weaker-than-expected increase in fourth quarter earnings as homeowner premiums declined. Shares of the largest publicly-traded home, car and life insurer eased 2.5 percent in after-hours trading.

Flextronics (Charts), the world's largest contract electronics manufacturer, posted fourth-quarter profit excluding items that rose 15 percent from a year earlier, edging past forecasts by a penny a share. Shares gained 3.5 percent in after-hours trading.

US Airways' (Charts) two-month hostile bid for Delta Air Lines (Charts) could reach a conclusion Wednesday as the creditors' committee at bankrupt Delta is due to meet to consider the smaller rival's offer.

US Air CEO Doug Parker reiterated Tuesday that Thursday is the deadline for the offer to be accepted or rejected by the creditors' committee, which will chose between the takeover proposal or Delta management's plan to emerge from bankruptcy in April as an independent carrier. But Parker hinted that US Air might consider raising its bid once again.

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