Weak housing data put investors on edge, a day ahead of a report on new home sales and the results of the Fed's interest rate meeting. The report put pressure on U.S. stocks yesterday, as the Dow tumbled 148 points or 1.4 percent to 10,293; the S&P 500 was off 1.6 percent to 1095; and the NASDAQ fell 1.2 percent to 2261. The selling spread to Asian and European markets. U.S. futures indicate a slightly higher opening.
With only a fragile recovery in place, there's virtually no chance that the Fed will raise interest rates from the current level of 0-0.25 percent at the conclusion of the two-day FOMC meeting this afternoon. It's also doubtful that the key language about "exceptionally low levels of the federal funds rate for an extended period" will remain in the statement. The Fed last raised rates four years ago, on June 29, 2006.
Jill Schlesinger is the Editor-at-Large for CBS MoneyWatch.com. Prior to the launch of MoneyWatch, she was the Chief Investment Officer for an independent investment advisory firm. In her infancy, she was an options trader on the Commodities Exchange of New York.