Wall Street Set For Flat Open Ahead Of Fed

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Wall Street was set for a flat open on Wednesday as investors waited to hear from the U.S. Federal Reserve on the state of the economy, and on signs of fatigue after the S&P 500 benchmark index ended at another all-time closing high.

* U.S. private sector adds 119,000 jobs in April -ADP

* U.S. Fed expected to maintain $85 bln/month in bond buys

* S&P closes at new record, marks sixth straight months of gains

* Futures: S&P up 0.4 pt; Dow up 5 pts; Nasdaq up 4 pts

Wall Street was set for a flat open on Wednesday as investors waited to hear from the U.S. Federal Reserve on the state of the economy, and on signs of fatigue after the S&P 500 benchmark index ended at another all-time closing high.

U.S. stock index futures slightly cut modest gains following a jobs report that showed U.S. private employers added 119,000 jobs in April, well below economists' expectations, in the latest piece of data to suggest the economy is encountering a soft patch.

The U.S. Federal Reserve, which is holding a two-day policy meeting, announces its latest decision at 2 p.m. EDT (1800 GMT) and the European Central Bank follows on Thursday. The Fed is likely to keep its foot on the stimulus pedal especially after disappointing economic data.

Expectations of more action to boost growth, in particular anticipation of an interest rate cut by the ECB, have helped European shares rally more than 3 percent from mid-April lows.

S&P 500 futures added 0.4 point and were in line with fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration of the contract. Dow Jones industrial average futures added 5 points while Nasdaq 100 futures rose 4 points.

"Sell in May and go away? I don't think so. We are likely to kick off May on the plus side," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

"The Fed will be the key today. I expect them to acknowledge that the economy has slowed down, and if anything, that will reinforce the notion that the Fed stimulus will be around till the end of the year."

The S&P 500 closed out its sixth straight month of gains, its longest winning streak since September 2009, with investors using any pullback as a buying opportunity.

The benchmark index hit a new intraday high in the last minutes of trading on Tuesday, following a session in which moves were slight as investors found few reasons to extend recent gains.

DreamWorks Animation SKG Inc shares were up 10 percent in premarket trade following upgrades from a number of brokerages after reporting earnings late Tuesday.

Merck & Co Inc reported lower-than-expected first quarter sales, as generic competition hurt demand for its Singulair asthma drug and the stronger dollar hit overseas sales of its medicines. The stock was down 0.2 percent in premarket trade.

The Institute for Supply Management's gauge of manufacturing, due at 10:00 a.m. EDT, is likely to show a reading of 50.9 for April, according to Reuters survey, compared to the previous month's reading of 51.3.

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