Dec 17, 2014 4:45 AM
Stocks mostly lower before Fed statement
The Associated Press
BEIJING (AP) Global stocks were mostly lower Wednesday as oil prices tumbled again while investors waited for a U.S. Federal Reserve statement on monetary policy.
KEEPING SCORE: In early trading, Germany's DAX shed 1 percent to 9,471.58 points and France's CAC-40 was off 0.9 percent at 4,056.06. Britain's FTSE 100 dropped 0.8 percent to 6,283.22. Wall Street looked set for a rebound. Futures for the Dow Jones industrial average and the Standard & Poor's 500 were both up 0.5 percent. On Tuesday, the S&P lost 0.9 percent and the Dow ended down 0.7 percent.
FED MEETING: The Federal Reserve was due to end a two-day meeting on Wednesday with a statement that, despite turmoil in Russia, was expected to drop a promise to keep interest rates low for a "considerable time." Analysts expected no immediate change in monetary policy, which the Fed has said would return to normal sometime next year following its history-making stimulus in the aftermath of the 2008 global crisis.
THE QUOTE: "The dominant theme is nervous trading in emerging markets as the Federal Reserve is tipped to switch to a hawkish bias," said Stan Shamu of IG Markets in a report. "While the US economy has been progressing significantly, the challenge will be how to proceed given the backdrop of turmoil in the rest of the world. The U.S. has been immune to events abroad so far but perhaps this will worry the Fed enough to exercise caution."
ASIA'S DAY: China's Shanghai Composite Index gained 1.3 percent to 3,061.02 points and Tokyo's Nikkei 225 added 0.4 percent to 16,819.73. Hong Kong's Hang Seng was off 0.4 percent at 22,585.84 and Seoul's Kospi lost 0.2 percent to 1,900.16. Taiwan, Singapore and Manila also were down while Sydney, Bangkok and New Zealand rose.
RUBLE ROCKED: The ruble dropped 20 percent under pressure from lower oil prices and Western sanctions over Moscow's conflict with Ukraine. That was despite a decision by Russia's central bank to hike its benchmark interest rate to support the ruble. "The end is near for Russia's economic and financial stability," said Carl B. Weinberg of High Frequency Economics in a report. Weinberg warned foreign creditors might face a wave of defaults by Russian borrowers. Apple Inc. halted sales in Russia, blaming the financial turmoil.
OIL SLUMP: Crude prices fell further from already-low levels, hammering stocks of energy producers. U.S. crude was down $1.01 to $54.92 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 2 cents the previous session to $55.93. Brent crude, used to price international oils, lost 76 cents to $59.23 per barrel in London.
CURRENCIES: The dollar rose to 117.12 yen from 117.07 yen late Tuesday. The euro fell to $1.2469 from the previous day's $1.2502.