Stock Market Today: Futures Slip as Eyes Turn to Fed's Yellen

NEW YORK (TheStreet) -- U.S. stock index futures were trading lower Tuesday as the markets wait to hear from the Federal Reserve and Chair Janet Yellen on the path of monetary policy.

Dow Jones Industrial Average futures were down 21 points, or 19.14 points below fair value, to 16,922. S&P 500 futures were off 2.5 points, or 1.93 points below fair value, to 1,973.5. Nasdaq futures were down 8.7 points, or 3.64 points below fair value, to 4,016.8.

U.S. stocks markets had a dull finish on Monday as money from large investors slowed its flow into U.S. equities in the lead-up to the meeting of the policymakers.

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"The challenge for the Fed is whether to adjust the language of its meeting statement, and if so, how to do it in a way that does not unnerve investors," said David Joy, chief market strategist at Ameriprise Financial. Joy expects the Fed to reiterate that its future actions are data dependent, and that it intends to remain considerably accommodative.

Bond yields already have started to adjust to the possibility of less accommodative policy, with the yield on the 10-year Treasury note rising by almost 30 basis points in just the past two weeks, to 2.61% from 2.32%.

Read More: European and Asian Stocks Extend Declines Ahead of Fed Meeting

By the end of this year, the S&P 500 could still be trading around 2014 if Fed rate-hike concerns as well as rising bond yields weigh on the market's valuation multiple, according to Yardeni Research data.

Global stock indices extended declines on Tuesday, with some European indices at a two-week low, as the Fed begins its discussions.

In Tuesday's individual stock news, Alibaba, the e-commerce giant, raised the price range of its initial public offering because of strong demand to $66 to $68 a share, up from its previously set range of $60 to $66 apiece. Yahoo! (YHOO) , which has large stake in the ecommerce giant and is looking to sell over 120 million shares in the IPO, edged up 0.24% to $42.65 in premarket trading.

Boeing (BA) appears positioned to beat out two smaller rivals for the bulk of a multibillion-dollar NASA contract to ferry astronauts to and from orbit, The Wall Street Journal reported, citing government and aerospace-industry officials. Separately, a joint venture of Boeing and Lockheed Martin (LMT) plans to announce on Wednesday that it will team up with Blue Origin, a company run by Amazon.com (AMZN) founder Jeff Bezos, to develop a new rocket engine, a source familiar with the plans told Reuters.

Sears (SHLD) has entered into a $400 million secured short-term loan with CEO Edward Lampert's hedge fund to be used for general corporate purposes.

United Airlines (UAL) reached a deal with the flight attendants' union to offer up to $100,000 in severance for workers who leave the company.

The SPDR Gold Trust (GLD) was up 0.27% to $118.96. The United States Oil Fund (USO) was down 0.26% to $34.47.

U.S. producer prices for August were flat vs. the 0.1% uptick expected by economists, the Bureau of Labor Statistics reported before the market open.

Read More: Stock Market Today: Smart Money Eases Out of U.S. Stocks

-- By Andrea Tse in New York

Follow @AndreaTTse

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