NEW YORK (CNNMoney.com) -- Stocks were set to move higher at Wednesday's open as investors await the latest pronouncement on the economy from the Federal Reserve.
Dow Jones industrial average, Nasdaq-100 and S&P-500 futures were higher. Futures measure current index values against their perceived future performance and offer an indication of how markets may open when trading begins.
Stocks broke a four-day winning streak Tuesday as bank shares led a late-session selloff and investors mulled mixed reports on inflation and manufacturing.
Mark Luschini, chief investment strategist for Janney Montgomery Scott, said futures are higher on investor confidence that the Fed will keep its key interest rate close to zero to maintain the "sweet spot" of low interest rates and high liquidity.
"The futures are indicating that we'll make up for what we lost yesterday," he said.
Luschini said the Fed will probably keep the rate flat through 2010 -- or at least until it sees stability in the housing and job markets.
Federal Reserve: The central bank will release its final policy statement of the year when it concludes a two-day meeting Wednesday afternoon.
The Fed is widely expected to hold the fed funds rate, a key overnight bank lending rate, unchanged at historic lows near 0%, the level at which the rate has stood for a year. But the policy statement, due at around 2:15 p.m. ET, could provide hints as to when the Federal Reserve plans to raise interest rates, either next year or in 2011.
Economy: Futures showed little reaction to economic indicators on Wednesday. This includes the Commerce Department's release of the Consumer Price Index (CPI), a measure of consumer inflation.
November CPI rose 0.4% after climbing 0.2% the previous month, matching expectations. Core CPI was unchanged from the prior month, compared to the expected gain of 0.1% for November, according to a Briefing.com consensus.
The Commerce Department released a pair of housing market indicators in the morning as well.
Housing starts increased to a 574,000 annual unit rate in November from a revised 527,000 unit annual rate in October, matching expectations from Briefing.com consensus. Building permits, a measure of builder confidence, rose to a 584,000 unit annual rate in November, which was more than the 570,000 rate forecast by Briefing.com consensus.
The weekly crude oil inventories report is also due in the morning.
World markets: Stocks in Asia ended mixed, with Tokyo's Nikkei index up 0.9% and Hong Kong's Hang Seng index down 0.9%. European indexes rose in midday trading.
Other markets: The dollar was mixed against the major international currencies, slipping versus the euro and the pound but rising against the yen.
Crude oil for January delivery rose 56 cents to $71.25 a barrel.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.97%||4.14%|
|15 yr fixed||3.05%||3.13%|
|30 yr refi||4.09%||4.22%|
|15 yr refi||3.16%||3.21%|
Today's featured rates:
Loosening state restrictions have given gun silencer sales a boost. Silencers are now legal in 41 states, compared to 37 four years ago. Also some gun makers are making it easy to attach them. More
If history is any guide, gold is still very expensive -- despite its recent fall. More
Aclima, a startup that makes environmental sensors, is hitching a ride with Google's cars to provide everyone with data about the air they breathe. More
Fast-food chains that operate in more than 30 locations nationwide are the sole target of a new rule in New York to hike their minimum wage to $15. But consumers and small business owners, as well as some employees, may be the ones to pay the price. More
You can't blame it on the economy anymore. More Millennials now have jobs, but are still living at home. More