Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Stocks set to drop

By CNNMoney.com staff


NEW YORK(CNNMoney.com) -- U.S. stocks were headed for a lower open Wednesday, as investors continued to worry about the recovery as they mull the Federal Reserve's latest policy statement.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were all slightly down of the opening bell. Futures measure current index values against perceived future performance.

Stocks rallied Tuesday after the Fed said it would take any action necessary to support the recovery, but gains were short lived as investors considered the Fed's downbeat economic outlook.

While the Fed said it expects improvement ahead, the central bank also cautioned that "the pace of economic recovery is likely to be modest in the near-term."

Investors were also disappointed that the Fed didn't announce any new specific measures or put a dollar figure on its policy of quantitative easing -- buying long-term U.S. treasurys to boost the economy -- said Frank Longman, senior vice president and desk analyst for Brean Murray, Carret & Co.

Traders will be closely watching the Fed's securities purchases on Wednesday, he said, for any indication of how yesterday's statement translates into real action.

Companies: Microsoft (MSFT, Fortune 500) said late Tuesday that it was hiking its quarterly dividend by 23% to 16 cents a share. Shares of Microsoft fell 0.7% in premarket trading.

Shares of Adobe Systems (ADBE) got slammed after the company issued a sales and earnings outlook that fell far short of analysts estimates. After the closing bell Tuesday, Adobe reported a solid quarterly profit but the disappointing guidance sent the stock tumbling. Shares were down 15% premarket.

World markets: European stocks fell in morning trading. Britain's FTSE 100 lost 0.6%. The CAC 40 in France and Germany's DAX both declined about 1%

Asian shares ended the session mixed. The Nikkei in Japan lost 0.4%, while the Hang Seng in Hong Kong and Shanghai Composite closed the session with modest gains.

Currencies and commodities: The dollar fell against the euro, the Japanese yen and the British pound.

Crude oil for November delivery, the most active contract, rose 36 cents to $75.33 a barrel. Traders are awaiting the government's latest data on oil inventories due at 10:30 a.m. ET.

Gold futures continued their march toward $1,300 an ounce. Gold for December delivery climbed $19.80 to $1,294.10 an ounce, after posting a new intra-day record of $1,296.50 earlier.

Bonds: The price on the 10-year Treasury note was slightly higher, pushing down the yield to 2.59% from 2.62% late Tuesday. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.90%4.01%
15 yr fixed3.01%3.13%
5/1 ARM3.19%3.26%
30 yr refi3.98%4.12%
15 yr refi3.08%3.23%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 17,689.86 -56.12 -0.32%
Nasdaq 5,128.28 -0.51 -0.01%
S&P 500 2,103.84 -4.79 -0.23%
Treasuries 2.20 -0.06 -2.78%
Data as of 12:16am ET
Company Price Change % Change
Bank of America Corp... 17.88 -0.25 -1.38%
Micron Technology In... 18.51 -1.39 -6.98%
Facebook Inc 94.01 -1.20 -1.26%
Apple Inc 121.30 -1.07 -0.87%
Frontier Communicati... 4.72 0.09 1.94%
Data as of Jul 31

Sections

Some families are outraged at the sums they've been offered by Lufthansa as compensation for the Germanwings plane crash in March which killed 150 people. 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