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US stocks drift lower ahead of Fed meeting


AP Business Writer Financial markets inched lower in early trading Wednesday as investors sifted through a batch of mixed corporate earnings and awaited the Federal Reserve's latest policy update and outlook on the economy.

KEEPING SCORE: The Standard & Poor's 500 index slipped one point, or 0.1 percent, to 1,940 as of 11:24 a.m. Eastern Time. The Dow Jones industrial average fell 47 points, or 0.3 percent, to 16,761. The Nasdaq composite declined six points, or 0.1 percent, to 4,331.

FED SPEAKS: The Fed's policymaking committee caps a two-day meeting Wednesday afternoon with a statement outlining the central bank's plans and updating its economic forecasts. Fed officials were widely expected to approve a fifth cut in the Fed's monthly bond purchases because the job market has steadily strengthened. No clear signal is expected on when the Fed will start raising short-term interest rates from record lows.

INFLATION IMPACT? Some market watchers have speculated that a sharp rise in consumer prices last month might compel the Fed to ease back faster on its economic stimulus efforts. But Uri Landesman, president of Platinum Partners, doesn't see that happening.

"You're going to need more data than that to take what has been an ultra-accomodative Fed and make them a little less supportive," he said.

SHIP SHAPE: FedEx gained $6.43, or 4.6 percent, to $146.76 in morning trading after the company reported that its quarterly profit rose as growth in online shopping gave its ground-shipping business a lift. Earnings and revenue both topped Wall Street's expectations.

SECTOR VIEW: Seven out of the 10 sectors in the S&P 500 were in the red, with telecommunications stocks down the most. Utilities led the gainers.

UNAPPETIZING FORECAST: Food maker ConAgra slashed its fourth-quarter earnings outlook, citing slumping sales for its consumer foods segment, as well as weak profits for its private brands unit. The stock sank $2.27, or 6.8 percent, to $30.61.

REST UNEASY: Shares in La-Z-Boy slumped in early trading, a day after the furniture seller posted weaker than expected fourth-quarter earnings and lower sales. The stock shed $2.09, or 8.4 percent, to $22.75.

OVERSEAS: World stocks were muted. Germany's DAX rose 0.2 percent while France's CAC-40 fell 0.1 percent. The FTSE 100 index of leading British shares added 0.2 percent. In Asia, most benchmarks ended lower, except in Japan, where the Nikkei 225 rose 0.9 percent as the dollar strengthened 0.1 percent to 102.25 yen.

BONDS: The yield on the 10-year Treasury note fell to 2.64 percent from 2.65 late Tuesday.

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