➤ Fed to announce policy decision, rate path expectations.
➤ U.K. PM May to formally request short Brexit delay.
➤ Treasury yields drop below 2.60%; dollar steady.
➤ Bayer shares lead losses in Europe after cancer ruling.
Wall Street is set to open flat amid weak trading in global markets, while the dollar steadied against majors and U.S. bonds rose as investors await the Federal Reserve's latest rate decision.
Policy setters are expected to keep interest rates unchanged and reiterate their wait-and-see approach to policy later this afternoon, with analysts penciling in just one rate hike instead of two for the year.
A so-called dot plot showing that more hikes may be on the way could once again "roil the markets," as many investors believe the Fed is done raising rates, wrote Richard Moody, chief economist at Regions Financial Corp., in a note.
Yields on 10-year Treasurys, which move opposite prices, lost 2 basis points to just under 2.60% at 6:30 a.m. ET, while the dollar index ticked up 0.04%.
Elsewhere, sterling remains under pressure amid lingering uncertainty surrounding the U.K.'s impending departure from the European Union. British Prime Minister Theresa May is expected to formally request a short extension to Brexit from the current March 29 date, but the EU's chief negotiator, Michel Barnier, said the bloc will only grant an extension if it raised the chance of a withdrawal agreement being ratified by U.K. lawmakers.
The pound was down 0.29% versus the dollar, while the euro was relatively unchanged against the U.S. currency. The Japanese yen dipped 0.12% against the dollar.
In equities, Asian stocks broadly edged lower as concerns over trade talks between the U.S. and China returned to the spotlight. U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin reportedly plan to hold another round of talks with Chinese Vice Premier Liu He, with the aim of signing a deal by April.
The Shanghai SE Composite index closed broadly flat, while Hong Kong's Hang Seng dropped 0.49% and the MSCI index of Asia-Pacific stocks outside Japan slipped 0.12%. The Nikkei 225 eked out a 0.20% gain after a mixed session earlier, with Sony Corp. falling more than 3% after Alphabet Inc. unit Google LLC yesterday launched a cloud-based game streaming platform.
In Europe, Germany's DAX index fell 1.20% as Bayer AG tumbled nearly 13% after a jury in California concluded that the company's top-selling weed killer, which it inherited after acquiring Monsanto Co., was responsible for causing cancer. The wider Stoxx 600 index fell 0.42%, with the German drugmaker leading the losses.
Futures for the S&P 500 and the Nasdaq 100 ticked up 0.03%. Shares in FedEx Corp. tumbled nearly 7% in premarket trading after the company lowered its outlook for fiscal 2019, while Walt Disney Co. will also be in focus after it completed the acquisition of 21st Century Fox Inc.
In commodities, Brent crude oil fell 0.13% to $67.52 per barrel on the ICE Futures Exchange. Gold dropped 0.28% to $1,302.80 per ounce.
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EDP strategy includes possible sale of stakes in US renewable assets
The day ahead:
10:30 a.m. ET — EIA petroleum status report
2 p.m. ET — U.S. Federal Open Market Committee announcement