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Before the bell: Stock futures edge up as Fed meeting starts

The Before the Bell report is constantly updated to reflect the latest news developments and market moves in the premarket. Check back later for updates.

North American stocks look set to assume a holding pattern as the U.S. Federal Reserve kicks off a two-day monetary policy meeting that could mark the beginning of the end for its bond-buying stimulus.

Futures for the Dow Jones industrial average were up 32 points and S&P 500 futures were up 1 point before markets open for trading. The tame moves follow a 129-point surge by the Dow on Monday.

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European stocks were down about 0.3 per cent in afternoon trading there, following their biggest one-day gain in two months. In Japan, the Nikkei 225 rose 0.8 per cent in overnight trading.

The Fed could announce the start of tapering on Wednesday, or at least hint that tapering is coming. Although opinions among economists are divided, most agree that the Fed will make some sort of move by March at the very latest.

Economic news on Tuesday will no doubt by analyzed by the Fed. While economic activity has been strong enough to warrant the end of bond-buying by the Fed, inflation has been below target, and the latest data continued that trend. Inflation was flat in November from October, even tamer than the rise of 0.1 per cent expected by economists.

In corporate news, keep an eye on Boeing Co. The aerospace company announced a 51 per cent boost to its quarterly dividend and authorized a massive $10-billion (U.S.) share buyback plan, which is Boeing's largest ever. The shares were up 2.1 per cent in premarket activity.

Here's a closer look at what's going on this morning and what is to come.

MARKETS:

Equities:

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Futures: S&P 500 +0.07 per cent; Dow +0.21 per cent; Nasdaq +0.10 per cent; TSX Toronto 60 -0.09 per cent

Hong Kong's Hang Seng -0.20 per cent

Shanghai composite index -0.46 per cent

Japan's Nikkei +0.83 per cent

London's FTSE 100 -0.33 per cent

Germany's DAX -0.27 per cent

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France's CAC 40 -0.75 per cent

Commodities:

WTI crude oil (Nymex Feb) -0.21 per cent at $97.56 (U.S.) a barrel

Gold (Comex Feb) -0.59 per cent at $1,237.10 (U.S.) an ounce

Copper (Comex Mar) -0.02 per cent at $3.33 (U.S.) a pound

Currencies:

Canadian dollar at 94.44 (U.S.), vs. 94.46 at Monday's North American close.

U.S. dollar index up 0.07 at 80.14

Bonds:

U.S. 10-year Treasury yield 2.87 per cent, down 0.02

ECONOMIC INDICATORS:

Canada factory shipments in October rose 1 per cent from September, far surpassing the Street forecast calling for decline of 0.3 per cent.

The U.S. Consumer Price Index for November was unchanged from October, even tamer than the 0.1 per cent rise economists had expected. When excluding volatile food and energy components, inflation rose 0.2 per cent, a tad higher than expected.

(10 a.m. ET) U.S. housing market index for December, forecast to rise to 55 from 54.

STOCKS TO WATCH:

Boeing shares are up about 2 per cent in the premarket after the company late Monday announced a hike in its quarterly dividend and authorized a share-buyback plan.

Facebook shares are up almost 2 per cent in the premarket after it said it has been testing a new way to ad promoted videos into users' news feeds since last September. The effort has garnered a 10 per cent increase in views, likes, shares and comments, according to Facebook.

3M shares are up 2.6 per cent in the premarket after announcing a boost in its dividend and providing forward guidance that was largely in line with Street estimates.

Frontier Communications has agreed to acquire AT&T's wireline business and statewide fiber network in Connecticut for $2-billion (U.S.) in cash.

ANALYST ACTIONS:

JPMorgan upgraded Hewlett-Packard to "overweight" from "neutral" and raised its price target to $35 (U.S.) from $30.

Goldman Sachs downgraded Catamaran to "neutral" from "buy" and cut its price target to $50 (U.S.) from $61.

Atlantic Equities downgraded Twitter to "neutral" from "overweight" and raised its price target to $50 (U.S.) from $34.

Susquehanna upgraded Facebook to "positive" from "neutral" and raised its price target to $68 (U.S.) from $52.

Canaccord Genuity hiked its price target on Herbalife to $87 (U.S.) from $77 and reiterated a "buy" rating. SunTrust Robinson Humphrey raised its target to $85 (U.S.) from $78.

JPMorgan upgraded Western Digital to "overweight" from "neutral" and raised its price target to $100 (U.S.) from $56.

Citibank raised its price target on Yahoo to $46 (U.S.) from $39 and maintained a "buy" rating.

RBC Dominion Securities upgraded Monster Beverage to "top pick" from "outperform" and reiterated a $77 (U.S.) price target.

TD Securities upgraded Pembina Pipeline to "buy" from "hold" and raised its price target to $38 (Canadian) from $36. RBC Dominion Securities raised its price target to $42 (Canadian) from $40 and reiterated an "outperform" rating.

Canaccord Genuity raised its price target on Valeant Pharmaceuticals International to $119 (U.S.) from $115 and maintained a "buy" rating.

M Partners hiked its price target on Lake Shore Gold to $1.05 (Canadian) from 75 cents and reiterated a "buy" rating.

THIS MORNING'S TOP INVESTING LINKS:

A new study by Bloomberg has found investor James Pattison is Canada's richest person after it was revealed David Thomson owns a smaller stake in his family's investment company than previously reported. The study has also identified Canada's richest woman.

Investors are dumping gold-backed exchange-traded products at the fastest pace since the securities were created a decade ago.

How to get comfortable with index investing for those who adhere to the belief of market-beating returns.

If you want to buy a promising-looking stock that other investors regard as junk, try not to do it in January.

Why share buybacks have become so popular.

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For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities.

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