Wall Street flinches ahead of Fed decision

NEW YORK: Major US indices opened lower on Wednesday as Wall Street looked ahead to the conclusion of the Federal Reserve's meeting later in the day, when central bankers could comment on inflation.

Traders have been spooked in recent sessions by the possibility that massive stimulus spending enacted in Washington could cause prices to rise.

Those concerns have sent bond yields up and tech stocks down as traders moved into growth stocks, a dynamic that repeated itself in early trading.

About 20 minutes after markets open, the tech-rich Nasdaq Composite Index had fallen 1.2 percent to 13,309.84, while the broad-based S&P 500 had lost 0.4 percent to 3,947.27.

The benchmark Dow Jones Industrial Average was up 0.3 percent at 32,923.27.

Charles Schwab investment bank said traders were "fence-sitting" ahead of the end of the Fed meeting, where the central bank will likely weigh in on the trends that have caused stocks to oscillate in recent weeks.

"The Fed's statement will be followed by updated economic projections and Fed Chairman (Jerome) Powell's customary press conference, which will likely gain heightened scrutiny given the backdrop of rising inflation expectations," Schwab wrote.

Also on investors' mind was Commerce Department data released before markets opened showing new home construction and permits plunged in February, but that was widely viewed as a consequence of bad weather.

Stocks that would benefit from the economy's reopening after Covid-19 rose in early trading, with Boeing gaining 1.6 percent and Carnival Cruise Line 0.9 percent.