DJI- NEW YORK, Sept 5 (Reuters) - U.S. stocks closed out a second straight session of thin trading on Wednesday, with investors reluctant to make big bets ahead of a crucial meeting of the European Central Bank, which could announce new policies to help contain the euro zone's debt crisis.
Media reports that European policymakers would unveil a bond-buying plan to bring down crippling borrowing costs in euro zone economies boosted sentiment, but it wasn't enough to drive gains in stocks.
Shares opened lower, hurt by FedEx Corp FDX.N, which late Tuesday cut its quarterly profit outlook on weakness in the global economy. FedEx is considered an economic bellwether because of its role as the No. 2 world shipping company. The stock fell 2 percent to $85.80, United Parcel Service UPS.N fell 2.4 percent to $71.94 and the Dow Jones Transportation index .DJT lost 1.1 percent.
"While FedEx is only one company, it's one whose warning is indicative of the global economic slowdown we’re dealing with," said Leo Grohowski, chief information officer at BNY Mellon Wealth Management in New York.
Equities seesawed between positive and negative territory throughout the session. About 5.49 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, well below last year's daily average of 7.84 billion in a sign of investor caution.
Central Bank sources told Reuters the ECB was ready to waive seniority status on government bonds it buys under a new program which it is set to agree on at Thursday's Governing Council meeting.
Bloomberg earlier reported that the ECB would, with broad support from its council members, unveil an unlimited, sterilized program of bond purchases. The ECB has been expected to be cautious about disclosing the size of its bond-buying, given opposition from Germany’s central bank.
Further details of the plan will be revealed by ECB President Mario Draghi after Thursday's meeting, but some analysts cautioned the ECB may opt to wait until after the German constitutional court rules on the region's bailout funds on Sept. 12 to announce any new steps.
"While some of the rhetoric coming out of Europe has been positive, we'll need to see follow-through in actions now," said Grohowski, who helps oversee $171 billion in client assets.
The Dow Jones industrial average .DJI was up 11.54 points, or 0.09 percent, at 13,047.48. The Standard & Poor's 500 Index .SPX was down 1.51 points, or 0.11 percent, at 1,403.43. The Nasdaq Composite Index .IXIC was down 5.79 points, or 0.19 percent, at 3,069.27.
Equities have received a boost in recent months on expectations the ECB would start buying Spanish and Italian government bonds to ease the pressure on those countries' bond markets and that the Federal Reserve will adopt new stimulus to prop up the economy. The S&P is up about 7 percent since the start of June.
Nokia NOK1V.HE NOK.N and Microsoft Corp MSFT.O took the wraps off their most powerful smartphone on Wednesday, but the new Lumia failed to impress investors in what may have been the last major shot at winning back a market dominated by Apple AAPL.O, Samsung 005930.KS and Google GOOG.O. U.S.-listed shares of Nokia slumped 16 percent to $2.38 while Microsoft was little changed.
Shares of Facebook Inc FB.O rebounded almost 5 percent off an all-time low after the company promised not to sell stock to cover a nearly $2 billion tax bill and said it will allow employees to cash in their stock weeks ahead of schedule, moving to soothe nervous investors and its own staff as its share price spiraled downward from its $38 IPO price.
About 55 percent of companies traded on the New York Stock Exchange closed lower while 53 percent of Nasdaq-listed shares closed lower.
NYMEX- NEW YORK, Sept 5 (Reuters) - U.S. crude futures inched up in choppy trade on Wednesday, ahead of a European Central Bank meeting and a U.S. August payrolls report and as investors await central bank action in the face of slowing economic growth.
CBOT- Sept 5 (Reuters) - Soybean futures on the Chicago Board of Trade fell on Wednesday as weak cash markets amid an accelerating harvest triggered profit-taking a day after prices hit all-time highs near $18 a bushel, traders said.
• Actively traded November SX2 dropped 1.2 percent in the steepest decline in 3-1/2 weeks, settling 20-3/4 cents lower at $17.47-1/2 a bushel.
• Spot September soybeans SU2 dropped 23 cents, or 1.3 percent, to $17.48 a bushel after hitting a record high price of $17.94-3/4 per bushel on Tuesday.
• The rapidly approaching U.S. Midwest soybean harvest weighed on cash basis bids as grain merchants prepared for an influx of new-crop supplies. Bids fell by as much as 25 cents a bushel in the central Corn Belt. GRA/M
• The U.S. Agriculture Department on Tuesday said 30 percent of the U.S. soybean crop as of Sunday was in good to excellent condition, unchanged from the prior week and the lowest since 1988.
• Rain across the Midwest this week seen too late to help much of the soy crop recover from the worst U.S. drought in 56 years.
• Prices range-bound as traders look ahead to USDA monthly crop report next week.
FCPO- KUALA LUMPUR, Sept 5 (Reuters) - Malaysian crude palm oil prices slipped on Wednesday to a one-week low on market expectations of rising stockpiles in the world's second biggest producer.
Palm oil prices have been treading water even though the U.S. soy market hit a record high the previous day, as traders expect the Malaysian August data, due next Monday, to show stocks had climbed to their highest in nine months as still-high production offset strong exports. PALM/POLL
"The upside will be capped by the coming Malaysian Palm Oil Board inventory data, which we expect will remain above the psychological range of 2 million tonnes," Kenanga Investment's analyst Alan Lim Seong Chun said in a note.
"On the other hand, the downside will be supported by crude palm oil's above-average discount of $290 per tonne against soybean oil," he added.
Higher soybean and soybean oil prices mean consumers are likely to turn to substitutes such as palm oil.
The benchmark November contract FCPOc3 on the Bursa Malaysia Derivatives Exchange fell 2.2 percent to 2,990 ringgit ($959) per tonne, its lowest level since Aug. 29.
Total traded volume picked up to 32,372 lots of 25 tonnes each, higher than the usual 25,000 lots.
Reuters analyst Wang Tao said technicals for palm oil looked neutral with a range of 3,032 to 3,093 ringgit per tonne, and an escape from the range will point a future direction.
Higher palm oil stocks would help Malaysia cope with an anticipated increase in demand. Hamburg-based oilseeds analysts Oil World said global dependence on palm oil is expected to rise significantly in the next 12 months to compensate for insufficient supplies of other vegetable oils.
But some fear that a sluggish global economy could weigh on consumption of the tropical oil. HSBC expects prices in the medium-term to be underpinned by weak industrial demand from major consumers China, India and Europe.
In other vegetable oil markets, U.S. soyoil for December delivery BOZ2 fell 0.7 percent in late Asian trade and the most active January 2013 soyoil contract DBYF3 on the Dalian Commodity Exchange closed 0.7 percent lower.
REGIONAL EQUITY- BANGKOK, Sept 5 (Reuters) - Southeast Asian stock markets were lower on Wednesday, with Singapore ending at a six-week low and Malaysia falling to a four-week closing low, as investors cut risk asset exposure ahead of a European Central Bank meeting and a U.S. jobs report.
Singapore's Straits Times Index .FTSTI fell for a third session, finishing 0.5 percent lower at 2,995.90, the lowest since July 25. Malaysia's main index .KLSE slid 0.8 percent to 1,641.01, the lowest close since Aug. 8, halting a three-day rise.
The Ho Chi Minh Stock Exchange's VN Index .VNI fell 0.8 percent, reversing Tuesday's 1.5 percent gain, amid broadly-based sell-offs following the detention of the former chairman of the troubled Vietnam National Shipping Lines (Vinalines), analysts said.
