Stocks traded flat Wednesday, cutting earlier losses, ahead of the Federal Reserve's decision on monetary policy and waited for comments from chairman Ben Bernanke later this afternoon.
The Dow Jones Industrial Average struggled to stay in positive territory after finishing higher for the fourth straight day in the previous session.
Among the blue-chip components, JPMorgan and Alcoa gained, while Boeing slipped.
The S&P 500 gained and the tech-heavy Nasdaq were also flat. The CBOE Volatility Index, widely considered the best gauge of fear in the market, traded near 18.
Among key S&P sectors, energy and materials were higher, while utlities and consumer staples.
"The big issue for the markets as we go through the summer is this 'tug of war'—it looks like we’re in a broad consolidation through the summer time," said Michael Sheldon Chief Market Strategist at RDM Financial Group. "Until we start to see more evidence that the soft patch we’re currently experiencing is likely to give way to renewed strength in the fall, investors are likely to be somewhat cautious."
The confidence vote was passed in parliamentand enables the Greek government to push ahead with tough austerity measures which are key to avoid a default. However, fears that new bailout funds will not be unlocked remain a cause for concern.
"Markets moved higher yesterday (Tuesday) in anticipation of the vote, but investors are realizing there is a long road ahead for Greece to implement the measures required of them in the months ahead," said Sheldon. "For now, the FOMC meeting today has temporarily replaced Greece as the topic of conversation."
Traders will be closely watching the FOMC statement at 12:30 pm ET, followed by Ben Bernanke’s press conference at 2:15 pm ET. Many expect the Fed chairman to talk about why economic activity has slowed recently and expect him to say he sees momentum picking up in the second half of the year.
Bernanke will also likely comment on headline inflation pressures easingand say that core inflation is not a problem at the moment.
“If the data continued to disappoint…then we don’t think the Fed will hesitate on embarking on further asset purchases so a new round of QE (quantitative easing),” Sarah Hewin, regional head of research at Standard Chartered told CNBC.
BofA was higher even after JPMorgan cut its share view on the bank to 28 cents from 29 cents. Rivals Citigroup and JPMorgan also gained.
In earnings news, FedEx gained after the shipping service giant posted better-than-expected profits and expect robust earnings in 2012. Rival UPS also rose following the news.
Adobe slipped after the software maker reported earnings and revenue that topped analysts forecasts Tuesday but its outlook fell short.
CarMax jumped more than 5 percent to lead the S&P gainers after the used-car retailer's quarterly results blew past estimates as consumer continued to stay away from purchasing new cars in a slow-recovering economy.
And Jabil Circuit gained after the contract manufacturer reported earnings that beat estimates, thanks to a jump in revenue, but the firm expects current quarter profit largely below forecast.
Bed, Bath & Beyond is scheduled to post earnings after-the-bell tonight.
L3 Communications gained after investment firm Relational Investors is expected to report the largest stake in the major defense contractor, according to the WSJ.
Yahoo was flat after the search-engine firm said they have made progress towards an agreement with Alibaba over the e-payment unit Alipay.
Research In Motion slipped to hit another 52-week low after the BlackBerry maker was removed from UBS' list of top tech picks. RIM shares have plunged more than 50 percent year-to-date.
Meanwhile, Dentsply International advanced after the firm agreed to buy AstraZeneca's dental implants and medical devices unit for $1.8 billion in cash.
Oil extended gainsafter crude supplies dropped by 1.7 million barrels last week, according to a government report. U.S. light, sweet crude traded near $95 a barrel, while London Brent crude was above $113.
On the economic front, weekly mortgage applications fell last week as refinance demand dropped and interest rates rose, according to the Mortgage Bankers Association.
European markets were slightly lower on Wednesday morning, coming off Tuesday’s highs ahead of a vote of confidence for the Greek government.
Coming Up This Week:
WEDNESDAY: FOMC meeting announcement, Ben Bernanke speaks; Earnings from Bed Bath & Beyond
THURSDAY: Weekly jobless claims, new home sales, money supply, Yahoo shareholders meeting; Earnings from ConAgra, Discover Financial, Oracle, Accenture, Micron
FRIDAY: Durable goods, GDP, corporate profits
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