* ECB ready to waive preferred creditor status - sources
* FedEx down after slashing forecast, weighs on transports
* S&P up 7 pct since start of June on stimulus hopes
* Dow up 0.1 pct, S&P down 0.1 pct, Nasdaq down 0.2 pct
By Ryan Vlastelica
NEW YORK, Sept 5 U.S. stocks closed out a second
straight session of thin trading on Wednesday, with investors
reluctant to make big bets ahead of a crucial meeting of the
European Central Bank, which could announce new policies to help
contain the euro zone's debt crisis.
Media reports that European policymakers would unveil a
bond-buying plan to bring down crippling borrowing costs in euro
zone economies boosted sentiment, but it wasn't enough to drive
gains in stocks.
Shares opened lower, hurt by FedEx Corp, which late
Tuesday cut its quarterly profit outlook on weakness in the
global economy. FedEx is considered an economic bellwether
because of its role as the No. 2 world shipping company. The
stock fell 2 percent to $85.80, United Parcel Service
fell 2.4 percent to $71.94 and the Dow Jones Transportation
index lost 1.1 percent.
"While FedEx is only one company, it's one whose warning is
indicative of the global economic slowdown we're dealing with,"
said Leo Grohowski, chief information officer at BNY Mellon
Wealth Management in New York.
Equities seesawed between positive and negative territory
throughout the session. About 5.49 billion shares traded on the
New York Stock Exchange, the American Stock Exchange and Nasdaq,
well below last year's daily average of 7.84 billion in a sign
of investor caution.
Central Bank sources told Reuters the ECB was ready to waive
seniority status on government bonds it buys under a new program
which it is set to agree on at Thursday's Governing Council
Bloomberg earlier reported that the ECB would, with broad
support from its council members, unveil an unlimited,
sterilized program of bond purchases. The ECB has been expected
to be cautious about disclosing the size of its bond-buying,
given opposition from Germany's central bank.
Further details of the plan will be revealed by ECB
President Mario Draghi after Thursday's meeting, but some
analysts cautioned the ECB may opt to wait until after the
German constitutional court rules on the region's bailout funds
on Sept. 12 to announce any new steps.
"While some of the rhetoric coming out of Europe has been
positive, we'll need to see follow-through in actions now," said
Grohowski, who helps oversee $171 billion in client assets.
The Dow Jones industrial average was up 11.54 points,
or 0.09 percent, at 13,047.48. The Standard & Poor's 500 Index
was down 1.51 points, or 0.11 percent, at 1,403.43. The
Nasdaq Composite Index was down 5.79 points, or 0.19
percent, at 3,069.27.
Equities have received a boost in recent months on
expectations the ECB would start buying Spanish and Italian
government bonds to ease the pressure on those countries' bond
markets and that the Federal Reserve will adopt new stimulus to
prop up the economy. The S&P is up about 7 percent since the
start of June.
Nokia and Microsoft Corp took
the wraps off their most powerful smartphone on Wednesday, but
the new Lumia failed to impress investors in what may have been
the last major shot at winning back a market dominated by Apple
, Samsung and Google.
U.S.-listed shares of Nokia slumped 16 percent to $2.38
while Microsoft was little changed.
Shares of Facebook Inc rebounded almost 5 percent off
an all-time low after the company promised not to sell stock to
cover a nearly $2 billion tax bill and said it will allow
employees to cash in their stock weeks ahead of schedule, moving
to soothe nervous investors and its own staff as its share price
spiraled downward from its $38 IPO price.
About 55 percent of companies traded on the New York Stock
Exchange closed lower while 53 percent of Nasdaq-listed shares