* CBOE Volatility index falls as Fed decision on timing nears
Nov. housing starts at highest in nearly six years
* Indexes: Dow up 0.3 pct, S&P up 0.1 pct, Nasdaq off 0.1 pct
By Angela Moon
NEW YORK, Dec 18 (Reuters) - U.S. stocks were little changed on Wednesday ahead of the Federal Reserve's last policy announcement of the year, which might determine the immediate future of its current program to stimulate the economy.
The Federal Open Market Committee will release a statement at 2 p.m. (1900 GMT). Fed Chairman Ben Bernanke will follow the announcement with his final news conference at the helm of the U.S. central bank about 2:30 p.m.
Many expect the Fed to continue its quantitative easing program at the current pace of $85 billion monthly asset purchases into next year. But stronger economic data recently has led some to believe now is the time to begin to take off the training wheels of the recovering economy and allow it gradually to grow on its own.
The CBOE Volatility index VIX, which usually moves inversely to the S&P 500 index, was down 2.5 percent at 15.81. The index gained more than 14 percent last week as investors speculated when the Fed would start tapering its stimulus efforts.
"There is a lot of protection built into the market already. Now people are asking, what if the Fed says exactly what is expected? The fear (of immediate taper) is dissipating and trades are adjusting their positions (in VIX)," said J.J. Kinahan, chief strategist at TD Ameritrade.
A survey of fund managers by Bank of America Merrill Lynch released on Tuesday revealed that only 11 percent of those polled expect a taper this week.
The Dow Jones industrial average rose 48.56 points or 0.31 percent, to 15,923.82, the S&P 500 gained 1.82 points or 0.1 percent, to 1,782.82 and the Nasdaq Composite dropped 5.522 points or 0.14 percent, to 4,018.158.
Data on Wednesday showed U.S. housing starts surged to the highest in nearly six years in November, a sign of strength in the housing market that could support a Fed decision to soon start cutting back its bond purchases.
"I don't think the market should ignore these numbers as an indication the consumer is in decent shape," said Paul Zemsky, head of asset allocation at ING Investment Management in New York.
"The reaction from the market is not too strong before the Fed, as nobody wants to take on a big position in the morning."
Shares of Lennar Corp rose 1.5 percent to $35.73 after the No. 3 U.S. homebuilder reported a 32 percent jump in fourth-quarter profit.
The stimulus has kept a lid on borrowing costs and flooded markets with liquidity, boosting an equities rally. The S&P 500 closed at a record high on Dec. 9.
Apple and Micron weighed on the Nasdaq, with the iPhone maker down 1.6 percent at $545.96 and Micron off 8.4 percent at $20.99.
Ford shares fell 7.8 percent to $15.38 after the carmaker said it expects North American pre-tax profit to be lower in 2014 than in 2013.
CVS Caremark said it expects sales and earnings to rise in 2014 even though it anticipated only a "modest" benefit next year from the launch of the Affordable Care Act, or Obamacare. Its shares rose 2.8 percent to $68.68.
Jabil Circuit shares tumbled 21.5 percent to $15.49 a day after the contract electronics maker said it would sell its warranty repair business and forecast current-quarter results way below Wall Street estimates.
General Mills fell 1.4 percent to $48.94 after it reported lower-than-expected quarterly results and said full-year profit could come in at the lower end of its forecast.