U.S. Stocks May Continue To Experience Choppy Trading

After ending the previous session nearly unchanged, stocks may continue to experience choppy trading early on Wednesday. The major index futures are currently pointing to a roughly flat open for the markets, with the S&P 500 futures unchanged.

Traders may remain reluctant to make significant moves ahead of the Federal Reserve’s monetary policy announcement this afternoon.

While the Fed is widely expected to leave its ultra-easy monetary policy unchanged, traders will be looking for any changes to the accompanying statement.

With the economy recovering strongly from the pandemic-induced recession and inflation accelerating, some analysts expect the Fed to begin hinting at tapering its asset purchases at upcoming meetings.

Traders are also digesting the latest earnings news from several big-name companies, including some megacap technology stocks.

Shares of Alphabet (GOOGL) are moving sharply higher in pre-market trading after the Google parent reported better than expected first quarter results and announced a $50 billion stock buyback.

Chipmaker Advanced Micro Devices (AMD) is also likely to see initial strength after reporting first quarter results that exceeded estimates and providing upbeat guidance.

On the other hand, shares of Microsoft (MSFT) are seeing notable pre-market weakness even though the software giant reported better than expected fiscal third quarter results.

Aerospace giant Boeing (BA) may also move to the downside after reporting a wider than expected first quarter loss.

Most major companies have reported better than expected results this earnings season, but the markets have not seen much buying interest in response due to concerns about valuations and whether the results are strong enough to support even further upside.

With traders looking ahead to the Federal Reserve’s monetary policy announcement, stocks showed a lack of direction over the course of the trading day on Tuesday. The major averages spent the day bouncing back and forth across the unchanged line.

The tech-heavy Nasdaq posted a modest loss, slipping 48.56 points or 0.3 percent to 14,090.22, while the Dow and the S&P 500 closed nearly flat. The Dow inched up 3.36 points or less than a tenth of a percent to 33,984.93 and the S&P 500 edged down 0.90 points or less than a tenth of a percent to 4,186.72.

In overseas trading, most stock markets across the Asia-Pacific region moved modestly higher during trading on Wednesday. Japan’s Nikkei 225 Index crept up by 0.2 percent, while China’s Shanghai Composite Index rose by 0.4 percent.

The major European markets have also moved to the upside on the day. While the French CAC 40 Index has climbed by 0.6 percent, the U.K.’s FTSE 100 Index is up by 0.5 percent and the German DAX Index is up by 0.4 percent.

In commodities trading, crude oil futures are rising $0.46 to $63.40 a barrel after jumping $1.03 to $62.94 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,764.60, down $14.20 compared to the previous session’s close of $11,778.80. On Tuesday, gold edged down $1.30.

On the currency front, the U.S. dollar is trading at 108.94 yen compared to the 108.70 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.2071 compared to yesterday’s $1.2091.

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