NEW YORK (CBS.MW) -- Stocks are poised for some upside action once trading begins on Tuesday while a two-day Fed meeting is set to commence.
Economists are expecting the Fed to stand pat on rates following 11 cuts in 2001 that took the fed funds rate from 6.50 percent to 1.75 percent. An upbeat speech from central bank chief Alan Greenspan last Thursday squashed all remaining expectations for another helping hand from the Fed. See Economic Preview.
Still, market observers expect the Fed to retain a bias to ease and will be closely scrutinizing the wording in the statement released at the conclusion of the meeting Wednesday afternoon for some cues on the future course of monetary policy.
In economic news, December durable goods orders rose 2 percent, more than expectations for a 1.2 percent climb. Excluding transportation orders, durables gained 1.4 percent and rose 1.7 percent excluding defense.
March S&P 500 futures edged up 0.30 point but were trading around 2.20 points above fair value, according to HL Camp & Co. And Nasdaq futures gained 7.50 points, or 0.5 percent and were trading 11.80 points above fair value.
Among shares changing hands in the pre-open, Texas Instruments (NYSE: TXN - news) traded up $1.60 to $30. After the close Monday, Texas Instruments reported a fourth-quarter loss from operations that was narrower vs. the Thomson Financial/First Call estimate.
Drug giant and Dow component Merck (NYSE: MRK - news) rallied $1 to $58 in Instinet action after announcing its intention to spin off its prescription drug unit, Merck-Medco, as a separate publicly-traded company by mid-2002. Merck said its 2002 outlook for operating earnings in its core pharmaceutical business remains unchanged and said 2003 earnings should grow at a "double-digit" rate.
In earnings news, FleetBoston Financial (NYSE: FBF - news) reported a fourth-quarter loss of 49 cents a share as opposed to a profit of 81 cents a share in the year-ago quarter. The bank took a $538 million after-tax charge to write down loans and set aside funds for Argentina exposure. The company had delayed releasing its results to better gauge the Argentina effect.
Treasury and econ focus
Government bonds traded lower across the board, with the 10-year Treasury note off 7/32 to yield 5.105 percent while the 30-year government bond erased 12/32 to yield 5.50 percent.
Still ahead on the economic front is the January consumer confidence index, seen coming in at 96 from December's 93.7 reading.
In the currency sector, the dollar shed 0.1 percent to 133.38 yen while the euro slipped another 0.1 percent to 86.06 cents
