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The two-day Fed meeting which began yesterday will come to an end with an announcement at 7pm (London time). There is speculation that the stimulus package will be trimmed, but the important question is how much by. At $85 billion per month, some economists are predicting it will be reduced by $10 billion. If more, we could see a decline in equities. Trading volumes and market volatility are likely to remain low until the announcement.
In corporate news, Smiths Group announced a cash return to shareholders in the region of £118 million, which equates to a special dividend of 30p per share. The stock is up 3%. Lloyds has managed to pull back some of yesterday’s losses, after the government sold a 6% stake in the lender, and the stock is up 1.6%. In the US, FedEx reported first-quarter earnings-per-share of $1.53, compared with $1.45 for the same period last year.
We are expecting the Dow Jones to open unchanged at 15,529.