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U.S. stocks open lower ahead of Fed's decision

Xinhua, May 3, 2017 Adjust font size:

U.S. stocks opened lower on Wednesday, as investors were cautious ahead of the Federal Reserve's announcement and tech giant Apple reported a fall in iPhone sales.

The U.S. central bank will release a statement later Wednesday when its two-day monetary policy meeting concludes. Wall Street, however, widely expected the Fed policymakers to hold interest rate steady.

According to the CME Group's FedWatch tool, market expectations for a May rate hike were just 4.8 percent.

"Nevertheless, the statement will be worth perusing for clues that the Q1 slowdown might give them pause in June, where market odds are about 70 percent in favor of another hike. Plus, with no need to argue over a rate hike at this meeting, hopefully they made progress toward settling on a plan to unwind the balance sheet," Chris Low, chief economist at FTN Financial, said in a note.

On the economic front, U.S. private sector employment increased by 177,000 jobs from March to April, on a seasonally adjusted basis and above the market consensus of 175,000, according to the March ADP National Employment Report.

The ADP figure is widely seen as a pre-indicator for the non-farm payrolls report due on Friday.

In corporate news, Apple posted better-than-expected adjusted earnings per share, but iPhone sales missed analyst expectations. Shares of Apple fell more than 1.5 percent in the early trading Wednesday.

Shortly after the opening bell, the Dow Jones Industrial Average was down 39.52 points, or 0.19 percent, to 20,910.37. The S&P 500 lost 5.88 points, or 0.25 percent, to 2,385.29. The Nasdaq Composite Index shed 24.86 points, or 0.41 percent, to 6,070.51. Endi