Investors are sitting on the sidelines as they wait for the Federal Reserve’s decision on rates, forcing stocks and exchange traded funds (ETFs) to remain relatively unchanged in morning trading.
The Fed is expected to make its announcement this afternoon. The U.S. Central Bank will likely keep rates at zero, but investors are waiting for indications of when interest rates may rise as well as clues about the strength of the economic recovery. The announcement will be made at 2:15 ET.
In the earnings arena, foodmaker General Mills (NYSE: GIS) reported a 51% increase in profits on lower ingredient costs and strong demand for its products. The maker of Cheerios reported quarterly earnings of $1.28/share, beating Wall Street’s expectations of $1.03/share. The company has witnessed increases in sales as more people are choosing to dine at home. The news sent the PowerShares Dynamic Food & Beverage (NYSEArca: PBJ) up 0.1% in morning trading.
In the real estate sector, mortgage applications jumped to their highest levels since May when interest rates were below 5%, states Julie Haviv for Reuters. The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ending Sept. 18 increased 12.8% to 668.5. This increase was fueled by consumer desire to refinance loans as well as obtain new mortgages to purchase homes. Despite the news, the iShares Dow Jones Real Estate (NYSEArca: IYR) was down 1.4% in morning trading.
Globally speaking, the G-20 summit is taking place in Pittsburgh were President Barack Obama is trying to convince European leaders to impose more stringent rules and regulations on bank pay limits. Some believe this will be tough, as European countries are becoming increasingly impatient at the pace of action on climate change and financial regulation in the U.S. Congress and by the Obama administration.
Overall, the Dow Jones Industrial Average dropped 0.2%, the S&P 500 was down 0.3% and the Nasdaq gave up 0.1% in morning trading.
For more stories on real estate, visit our real estate category.
Kevin Grewal contributed to this article.