WASHINGTON (dpa-AFX) - Stocks have shown a lack of direction over the course of the trading session on Wednesday, with traders reluctant to make significant moves ahead of the Federal Reserve's monetary policy announcement later this afternoon.
The major averages have been bouncing back and forth across the unchanged line and are currently narrowly mixed.
While the Nasdaq is up 19.09 points or 0.1 percent at 17,647.15, the S&P 500 is down 1.57 points or less than a tenth of a percent at 5,633.01 and the Dow is down 80.08 points or 0.2 percent at 41,526.10.
The choppy trading on Wall Street comes as traders look ahead to the Fed's highly anticipated interest rate decision, which is due to be announced at 2 pm ET.
The central bank is almost universally expected to lower interest rates, but there continues to be some debate about the size of the rate cut.
CME Group's FedWatch Tool is currently indicating a 61.0 percent chance of a half-point rate cut and a 39.0 percent chance of a quarter-point rate cut.
However, John Lynch, Chief Investment Officer for Comerica Wealth Management, said, 'Though consensus is leaning toward a 50 basis point move, we look for the Fed to cut by 25 basis points today.'
'Inflation growth is not yet at the Fed's target for price stability, the unemployment rate still hovers around 4.0%, and federal deficit spending continues to surge,' he added. 'In this environment, we believe the more prudent policy action is to withstand market pressure and proceed slowly with a 1/4 point mover lower today.'
In U.S. economic news, a report released by the Commerce Department showed a substantial rebound by new residential construction in the U.S. in the month of August.
Reflecting the lackluster performance by the broader markets, most of the major sectors are showing only modest moves on the day.
However, oil service stocks are seeing some weakness after surging in the previous session, with a modest pullback by the price of crude oil weighing on the sector.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index and China's Shanghai Composite Index both climbed by 0.5 percent.
Meanwhile, most European stocks have moved to the downside on the day. The U.K.'s FTSE 100 Index is down by 0.6 percent and the French CAC 40 Index is down by 0.4 percent, although the German DAX Index has bucked the downtrend and inched up by 0.1 percent.
In the bond market, treasuries are extending the modest pullback seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.9 basis points at 3.691 percent.
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