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Futures hold lower on GDP; Fed statement eyed

U.S. stock index futures pointed to a lower open on Wednesday, as investors awaited the conclusion of the two-day Federal Open Market Committee (FOMC) meeting.

The first estimate of first quarter GDP showed an increase of 0.2 percent, a sharp slowdown from the fourth quarter's 2.2 percent pace and below expectations of 1 percent growth. The government cited the strong dollar and the West Coast port strikes as negative factors.

The U.S. 10-year Treasury yield pared gains to dip below 2 percent following the news. The euro continued to strengthen, holding above $1.10.

Investors will scrutinize U.S. economic growth on Wednesday as the initial read on the first-quarter GDP comes ahead of a meeting statement from the "data-dependent" Federal Reserve.

Janet Yellen, Chair of the Federal Reserve.
Getty Images
Janet Yellen, Chair of the Federal Reserve.

On the Fed front, with inflation highly subdued and the labor market data having turned out softer than expected in March, analysts expect no change to policy.

"We might well see the post-meeting statement take a slightly more dovish tone consistent with the first rate hike taking place in September at the earliest," Robert Kuenzel from Daiwa Capital Markets said in a note. Pending home sales data for March is also due at 10:00 a.m. ET.

Mortgage applications gave back their gains last week, falling exactly as much as they had risen the previous week, according to the Mortgage Bankers Association (MBA). The decline came as interest rates edged higher.

Major earnings due on Wednesday include Fiat Chrysler, MasterCard, Time Warner before market open, with Baidu, Marriott, Boston Beer and Yelp after the bell.

Time Warner reported adjusted quarterly profit of $1.19 per share, 10 cents above estimates, with revenue also above forecasts. The company was helped by "March Madness" programming related to the annual NCAA college basketball tournament.

U.S. Steel posted an adjusted quarterly loss of 7 cents per share, surprising Street analysts who had expected a 12 cent per share profit. Revenue also missed estimates, as U.S. Steel said it has been hurt by significant steel imports. The company also lowered its earnings outlook for the full year

Twitter is on watch today after it plunged more than 20 percent following the premature release of its quarterly earnings report yesterday. Twitter is investigating how the report got released early, but the numbers disappointed investors with revenue falling short of Street estimates.

Lumber Liquidators said it's been advised that the Justice Department is seeking criminal charges against the company relating to the importation of certain products, and that the DOJ probe will likely cost it about $10 million. The company also reported an unexpected loss, and said Chief Financial Officer David Terrell would depart in June.

Reports say Alibaba, the China-based online retail giant, has imposed a hiring freeze, in an effort to make the company more efficient.

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European equities were mixed Wednesday as investors reacted to earnings reports and awaited the outcome of a two-day meeting by the U.S. Federal Reserve.

U.S. stocks closed mixed on Tuesday, with the Nasdaq in the red as investors were on edge ahead of the Fed statement due Wednesday.

CNBC's Peter Schacknow contributed to this report.