Early Optimism on Wall Street

Stocks are set for a bounce at the open of trading.
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Futures were pointing to a sharply higher open for stocks Wednesday as traders cheered

Oracle's

(ORCL) - Get Report

solid earnings report and geared up for the meeting of

Federal Reserve

policymakers.

S&P 500

futures were gaining 4 points to 1334.30 and were 7 points above fair value. Nasdaq 100 futures were higher by 7.5 points at 1650, nearly 12 points ahead of fair value.

On Tuesday, stocks pulled back amid a weak housing report, a revenue warning from Internet giant

Yahoo!

(YHOO)

and some last-minute nervousness in advance of the Fed meeting.

The

Dow Jones Industrial Average

closed down 14.09 points, or 0.1%, at 11,540.91, and the S&P 500 gave back 2.87 points, or 0.2%, to 1318.31. The

Nasdaq Composite

shed 13.38 points, or 0.6%, to 2222.37. Still, a late surge in buying allowed stocks to close well above their worst levels of the day.

One of the hardest-hit sectors was the Internet stocks, who tumbled after Yahoo! Chief Financial Officer Susan Decker said the company's third-quarter revenue would probably be in the bottom half of its projected range. Yahoo!'s shares slumped 11.2% to close at $25.75.

The weakness spilled over into names like

Google

(GOOG) - Get Report

, which lost 2.6% to $403.81,

eBay

(EBAY) - Get Report

, down 3.5% to $25.95, and

Amazon.com

(AMZN) - Get Report

, lower by 1.6% to $31.58.

To view Farnoosh Torabi's video take on today's market, click here

After the close, however, Oracle showed that not everything is grim in tech land. The database giant saw its shares hit a five-year high following a quarterly report that beat Wall Street's profit estimates by 2 cents and had revenue growth of 30%. The stock jumped 11% in late trading to $18.03, its best level since July 2001.

Barring a surprise, the story of the day will be the Fed and its meeting later to discuss its decision on interest rates. At the August gathering, the central bank left its target fed funds rate unchanged at 5.25%, but before that had raised rates by a quarter point at every meeting going all the way back to June 2004.

This time, market watchers are almost uniformly expecting the bankers to again let rates stand where they are. The accompanying statement will draw the most interest because it could provide some clues as to the future direction of rates.

Crude futures, a day after sinking more than $2 a barrel, were down further, falling another 66 cents to $61 a barrel. Other energy prices were weaker, as well. Precious metals also slipped, with gold dropping $3.90 to $579.30 an ounce and silver giving up 13 cents to $10.82 an ounce.

Overseas, Europe's bourses were higher. London's FTSE was rising 0.2% to 5843, and Frankfurt's Xetra DAX was up 0.7% to 5913. Asia's shares were mixed following the coup in Thailand. Tokyo's Nikkei slid 1% to 15,719, but Hong Kong's Hang Seng rallied 0.9% to 17,513.

To view Farnoosh Torabi's video take on today's market, click here