US open: Stocks head south ahead of Fed decision
US stocks opened lower on Wednesday as investors awaited a rate decision from the US Federal Reserve later in the session.
As of 1530 BST, the Dow Jones Industrial Average was down 0.13% at 27,075.28, while the S&P 500 opened 0.19% weaker at 3,000.10 and the Nasdaq Composite came out the gate 0.25% softer at 8,165.94.
The Dow Jones closed higher on Tuesday as crude oil futures skidded on news that Saudi oil output could be fully restored quicker than had originally been anticipated.
Focus for the session looked set to be all but locked on the Federal Reserve. US President Donald Trump recently branded Fed policymakers "boneheads" when he demanded the bank set zero or negative rates.
Despite the recent fluctuations in energy prices, the Fed was expected to cut rates by 25 basis points on Wednesday, marking just the second rate cut made by the central bank this decade after it opted to lower the Fed Fund Rate to 2.0-2.25% in July.
Chairman Jerome Powell will speak to the press at 1930 BST.
Oanda analyst Craig Erlam said: "While the interest rate probability tools have become a little erratic in recent days, there seems to be little question that the Fed is going to cut interest rates again today.
"The real question is whether they will stick to the mid-cycle adjustment message and refuse to explicitly signal more cuts or give up the fight and acknowledge that an easing cycle is underway."
Also weighing on sentiment was news that Donald Trump had asked the US Secretary to the Treasury to increase sanctions against Iran, in the latest escalation of tensions between the two countries.
The US president accused Iran of being behind the two drone attacks on a Saudi Arabian oilfield and the country's key processing facility over the weekend, which sparked fears that a surge in crude prices could add to the slowdown in the global economy.
On the data front, US housing starts hit a 12-year in August, according to figures released by the Commerce Department.
Housing starts jumped 12.3% to a seasonally-adjusted rate of 1.364 million from July’s revised rate of 1.215m, coming in well above expectations of 1.250m. On the year, housing starts were 6.6% higher.
Elsewhere, mortgage applications were mostly unchanged on the week ended 13 September, even as home borrowing costs shot up alongside bond yields, according to the Mortgage Bankers Association.
The MBA's seasonally-adjusted mortgage activity index dipped 0.1% to 569.5, while loan requests for home purchases rose for a third straight week.
In corporate news, shares in General Mills eased in early trading after the US food giant missed first-quarter sales estimates, while FedEx shares slumped at the bell after the shipping company posted a drop in first-quarter earnings and downgraded its guidance for the year