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The
central bank is unlikely to raise rates in this meeting but
investors will watch for any hints from Fed Chair Janet Yellen
at a press conference after the meeting on Wednesday about the
timing of a possible rate increase.
The Fed has said it remains data-dependent and will raise rates
only when it sees an improvement in the economy. Second-quarter
data points to a recovery after a halt in growth earlier in the
year.
U.S. housing starts fell in May after a hefty increase the
previous month, but a surge in permits for future construction
to a near eight-year high suggested the pullback was temporary
and pointed to underlying strength in housing.
"Investors are not expecting a whole lot from the Fed meeting,"
said Scott Brown, chief economist at Raymond James in St.
Petersburg, Florida. Brown expects a rate hike in September.
"The market is still anxious about Greece and would like the
situation to be dealt with one way or another. The
week-after-week uncertainty isn't good for the market."
World markets were down with European shares hitting a near
four-month low as financial markets braced for the possibility
of Greece defaulting on its debt.
Greek Finance Minister Yanis Varoufakis told a German newspaper
that he is not planning to present new reform proposals at a
Eurogroup meeting on Thursday, despite warnings from the rest of
Europe that time is running out.
There is an even chance of Greece defaulting on its debt
payments, according to economists polled by Reuters, although
the probability of it leaving the euro zone is still only
one-in-three.
S&P 500 e-minis <ESc1> were down 4.25 points, or 0.2 percent,
with 165,831 contracts traded at 8:43 a.m. ET (1243 GMT). Nasdaq
100 e-minis <NQc1> were down 13.25 points, or 0.3 percent, with
16,442 contracts and Dow e-minis <1YMc1> down 28 points, or 0.16
percent, with 7,245 contracts changing hands.
Coty's shares jumped 15.9 percent to $30.20 in premarket
trading, after the perfume maker won auctions to acquire
hair-care, fragrance and cosmetics businesses from P&G for as
much as $12 bln, according to sources. P&G was up 1.2 percent at
$79.10.
Avalanche Biotechnologies slumped 45.8 percent to $21.08, a day
after the eye drug developer's experimental therapy showed that
vision improvement was not significant. The result prompted
brokerages to cut their ratings on the stock.
American Airlines slipped 0.4 percent to $39.90 after it said it
would push back delivery of 35 Airbus Group A320neo family
jetliners by several years.
(Reporting by Tanya Agrawal; Editing by Don Sebastian)
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