Wall Street's new worry: Oil

NEW YORK (CNNMoney.com) -- Stocks were poised to open lower Thursday as investors weighed crude prices near $80 a barrel and another record low for the dollar ahead of next week's Federal Reserve meeting.

At 7:42 a.m. ET, Nasdaq and S&P futures pointed to lower open, with a comparison to fair value suggesting a modest decline at the market open.

Trading is expected to be lighter than normal due to the celebration of the Jewish holiday Rosh Hashanah.

"We'll probably see a trendless market that could slip at the opening, and we could be heading for plus and minus trading with light volume and all eyes fixed on oil prices," said Peter Cardillo, chief market economist of Avalon Partners.

Crude prices ended at another record close of $79.91 a barrel on Wednesday after hitting a record trading high of $80.18 during the session.

Oil prices were slightly lower early Thursday, although they remained near the $80 a barrel mark. A barrel of U.S. light crude slipped 3 cents a barrel to $79.88.

The rise in oil prices, which could place upward pressure on inflation, comes as pressure is growing on the Federal Reserve to aggressively lower its short-term interest rate in a bid to restore confidence in the financial markets.

"The Fed is caught in a bind here," said Cardillo. "(With) rising inflation pressure, credit markets at a near halt and markets wanting relief, I think they will accommodate but that will be accompanied by a harsh communiqué (about inflation)."

Volatility in the stock market is expected to increase ahead of that meeting next week.

The dollar also hit a fresh record low against the euro amid growing expectations that the Fed will cut interest rates at its meeting Sept. 18. The dollar was higher against the yen, though.

Treasury prices fell slightly in early trading, taking the yield on the 10-year note to 4.43 percent from 4.41 percent late Wednesday.

In global markets, Asian markets gained. Japanese stocks were mixed, however, in the wake of Prime Minister Shinzo Abe's resignation. European markets were lower near midday trading.

In a further sign of economic problems caused by the subprime mortgage problems, two more mortgage lenders announced deep staff cuts. First Horizon National (Charts) Corp. said after the close Wednesday it will cut at least 1,500 jobs by early next year.

Meanwhile, Washington Mutual (Charts, Fortune 500), the nation's largest thrift, said it will close one unit that bought mortgages from other home lenders and another that financed mortgage companies. The closures will eliminate 1,000 jobs, according to a report in its hometown Seattle Times.

The Wall Street Journal reported that United Auto Workers union President Ron Gettelfinger has told members of his bargaining team that he is willing to agree to the creation of a union-controlled trust fund to assume responsibility for nearly $100 billion in retiree health care costs.

That could clear way for new labor deals at General Motors (Charts, Fortune 500), Ford Motor (Charts, Fortune 500) and Chrysler Group that allow them to be more competitive with nonunion rivals. But the paper reports that a deal is far from certain.

Shares of Dow component GM gained nearly 2 percent in Frankfurt trading early Thursday, although Ford shares were slightly lower there.

Telecommunications equipment maker Alcatel-Lucent (Charts) saw shares plunge 11 percent in Paris trading after the company slashed its forecast for full-year revenue growth and said it now is looking at breakeven results for the third quarter.

McDonald's (Charts, Fortune 500) said late Wednesday it was raising its annual cash dividend 50 percent to $1.50 a share. The announcement came a day after the fast-food retailer posted a jump in same-store sales in August. Its shares gained nearly 3 percent in after-hours news following the announcement.