US open: Mixed start to trading ahead of FOMC decision

Wall Street trading began on a mixed note on Wednesday ahead of an update on the state of the nation's economy from the Federal Reserve later in the day.

As of 1550 BST, the Dow Jones Industrial Average was down 0.97% at 27,008.74 and the S&P 500 was 0.47% weaker at 3,192.25, while the Nasdaq Composite started out the session 0.39% firmer at 9,992.11.

The Dow Jones opened 263.56 points weaker on Wednesday, continuing on with the blue-chip index's losses in the previous session that halted its milt-day rally amid heightened concerns around another spike in Covid-19 cases and trade tensions between the US and the EU.

The key event on Wednesday agenda is an update from the Federal Open Market Committee, which started its two-day policy meeting on Tuesday. While the central bank is not expected to enact any major policy shifts, with its benchmark rate already near zero and asset purchasing programs continuing, market participants will still be keeping a keen eye out for indications that the Fed could possibly implement yield caps or strengthen forward guidance on how long it will keep its current policies in place.

The Fed's interest rate decision will be published at 1900 BST, while chairman Jerome Powell will address the media at 1930 BST.

US government debt prices were also higher at the open, with the benchmark 10-year Treasury note lower at 0.8171% and the yield on the 30-year Treasury bond also down at 1.5676%.

Also in macro news, mortgage rates held near record lows last week, leading to a wave of refinancing and purchasing applications.

The Mortgage Bankers Association said 30-year fixed rates for conforming loan balances of less than $510,400 ticked up 1 basis point higher to 3.38% for the week ending 5 June, just off last week's all-time low and a whole 1% softer year-on-year.

The MBA's refinancing index rose 11.4% to 3,529.0 points, recording its first weekly gain in two months.

Elsewhere, US consumer prices fell for a third straight month in May as underlying inflation remained weak and demand continued to be subdued amid the coronavirus-fuelled recession.

The Consumer Price Index fell 0.1% in May accordion to the Labor Department, after decreasing 0.8%.

In the corporate space, Facebook, Apple, Amazon and Microsoft all closed at all-time highs in the previous session and were also helping the Nasdaq stay in the green on Wednesday.

Uber shares were down 4.97% in early trade after reports broke that merger talks with rival Grubhub had broken down after European delivery giant Just Eat threw its hat into the ring, while Tesla shares accelerated more than 7% after a report said it would speed up production of its semi-trucks.

Boeing, Exxon Mobil, Chevron, American Express and JPMorgan Chase shares were all down at the open, weighing on major indices.