Stocks inched higher Monday as an easing in front-month crude lent limited support to a market that will probably trade cautiously ahead of the Federal Reserve's rate decision tomorrow. Index futures recently showed the S&P 500 trading half a point above fair value, while the Nasdaq 100 was set for a 2-point gain. The 10-year Treasury bond was down 2/32 in price to yield 4.68%, while the dollar rose against the euro and fell against the yen. Oil ticked lower as the government of Nigeria started talks with major oil companies about restarting production that has been curtailed by resurgent rebel activity. In electronic Nymex trading, May crude was recently falling 60 cents to $63.60 a barrel. Overseas markets were mixed, with London's FTSE 100 recently losing 0.4% to 6011 and Germany's Xetra DAX little changed at 5972. In Asia, Japan's Nikkei rose 0.5% overnight to 16,650, while Hong Kong's Hang Seng added 0.6% to 15,816. U.S. stocks are coming off a flat week in which the Dow Jones Industrial Average finished almost exactly where it started and the S&P 500 lost 0.3% to 1302. The Nasdaq Composite rose 0.3% to 2313. Trading could be similarly subdued Monday and Tuesday as traders await the Fed's pronouncement. Futures markets are currently pricing in 100% odds that Ben Bernanke's first meeting will end with the official fed-funds target rising a quarter-point, to 4.75%. The Fed's 15th consecutive hike would follow a mixed serving of economic data last week, including a strong number on existing home sales but a weaker one on new homes. As of Friday, odds that fed funds will rise to 5% after the Fed's May meeting were 79%, down from 94% the previous day. The market still sees a 92% chance that the Fed funds rate will stand at 5% at the June meeting. Odds of a 5.25% funds rate in June dropped to 0% from 6%. To view David Peltier's video take on today's premarket action,
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Monday's economic docket is bare. On Tuesday, in addition to the Fed announcement traders will see the consumer confidence index for March. The government's final reading on fourth-quarter gross domestic product will be released Thursday. Among companies, Alcatel's ( ALA) board reportedly will meet this Thursday to consider the company's recent merger talks with Lucent ( LU), the U.S.-based telecom equipment supplier. The negotiations were reported on Friday. Mirant ( MIR) reportedly is near a deal to raise $1.2 billion by recapitalizing its power operation in the Philippines. The company operates two big plants in the country and is its largest private power supplier. Citigroup raised its rating on miners Inco ( N), Alcan ( AL) and Phelps Dodge ( PD), saying copper and nickel prices should stay strong. Circuit City ( CC) was raised to hold from sell at Lehman Brothers, which argued that demand for big-screen televisions and game consoles should boost results through next year.