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MARKET PREVIEW: Techs focus on Fed

With visions of flat interest rates dancing in their heads, investors will probably sleep on Tuesday's meeting of the Federal Reserve Open Market committee. Asia and Europe were mixed, and the Dow is set to open slightly higher.


The market shouldn't have any dramatic reactions to Tuesday's meeting, as investors are certain that the FOMC will elect to leave interest rates unchanged at its last meeting on 1999. Though the meeting is too close to Christmas holidays and the approaching Y2K deadline to stir up anything too major, the Fed may reveal where it's headed on future policy by changing its "neutral stance" to a "tightening bias" toward raising rates. An announcement is expected from the Fed at 2:15 p.m. EST.

Investors should be celebrating some early Christmas bonuses from companies declaring stock-splits; DoubleClick (Nasdaq: DCLK) and Portal Software (Nasdaq: PRSF) should both be active, and Red Hat (Nasdaq: RHAT) also declared it will split its stock 2-for-1.

Expect the following technology stocks to be among Tuesday's most actively traded issues: Cabletron, Clarus, DoubleClick, Micron Electronics and Portal Software.

The Dow Jones industrial average took its lumps ahead of Tuesday's Fed meeting, falling 113 points to 11,144.27. However, the tech stocks continued their frenzied rally as the Nasdaq composite marched up 31 points to close at 3,783.89, another record.

At the Bell

The Dow Jones industrial average may open about 3 points lower. The Standard & Poor's 500 index for June futures contracts was down 0.4 points to 1434 at 7:31 a.m. EST in 24-hour electronic trading.

The Inter@ctive Week @Net Index was up 7 to 538.21.


Trading in Asia was mixed. The Nikkei 225 fell 0.52 percent to 18,080, Singapore's Strait Times index slipped 0.30 percent to 2,362 and Hong Kong's Hang Seng was up 0.97 percent to 16,249.


European markets were also moving in different directions. London's FTSE 100 fell 0.53 percent to 6,695. The CAC 40 in Paris rose 0.04 percent to 5,523 and the Xetra DAX in Frankfurt was down 0.12 percent to 6,370 at 7:04 a.m. EST.

Reuters contributed to this report.