Wall St set to open flat as earnings roll in

By Yashaswini Swamynathan

REUTERS - Wall Street was set to open little changed on Monday as investors assessed another set of corporate earnings and ahead of the Federal Reserve's policy meeting.

The Federal Open Market Committee (FOMC), which has had to defer raising interest rates, will begin its two-day meeting on Tuesday to decide whether the U.S. economy could absorb a rate increase in the near term.

The FOMC is scheduled to announce its decision on Wednesday at 2:00 p.m. ET (1800 GMT).

Even with recent data pointing to the U.S. economy being on strong footing, the Fed is still cautious about pulling the trigger due to global uncertainty sparked by Britain's vote to leave the European Union.

Traders have priced in a 14.7 percent chance of a rate hike in September and a 38.5 percent chance in December, according to CME Group's FedWatch tool.

Low expectations of rate hikes, robust economic data and higher-than-expected second-quarter earnings set Wall Street on a record-setting streak in the past two weeks. Investors are hopeful that companies continue a broad trend of beating analysts' expectations to justify valuations.

Of the 125 S&P 500 companies that have reported results so far, 68 percent have beaten earnings expectations. In a typical quarter, 63 percent of companies report above estimates, according to Thomson Reuters data.

"We're in a period where the market's looking really tired," said Matthew Tuttle, chief investment officer of Tuttle Tactical Management. "I think we're going to be in a wait-and-see phase today, ahead of the Fed's decision."

Wall Street marked its fourth-straight week of gains and the S&P 500 notched a new closing high on Friday, helped by telecom stocks and strong economic data.

Dow e-minis <1YMc1> were up 8 points, or 0.04 percent at 8:23 a.m. ET, with 22,781 contracts changing hands.

S&P 500 e-minis were up 0.75 points, or 0.03 percent, with 156,083 contracts traded. The benchmark index is just 0.02 percent away from its record intraday high of 2,175.63.

Nasdaq 100 e-minis were down 1 point, or 0.02 percent, on volume of 18,723 contracts.

Oil prices were trading near two-month lows on fears of global oversupply and economic headwinds that could hit demand. [O/R]

Yahoo's shares were down 0.8 percent at $39.05 premarket, after agreeing to sell its core internet business to Verizon for $4.8 billion. Verizon's shares rose 0.4 percent.[nL4N1AB3HT]

Micron shares rose 4.7 percent to $13.67 after a Credit Suisse analyst said the company's new rights agreement increased prospects of a strategic investment in the near term. The stock was the top percentage gainer among S&P components.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)