Most stocks fall on FedEx; investors await ECB

Financial markets were little changed on Wednesday as investors prepare for a series of key economic actions.

The Dow Jones Industrial Average gained 11.54 points to 13,047.48. The Nasdaq Composite Index dropped 5.79 points to 3,069.27, and the S&P 500 Stock Index fell 1.50 points to 1,403.44.

A meeting of the European Central Bank on Thursday could provide some sense of how the financial tensions in Europe will be handled. Several reports on announced layoffs, civilian payrolls and initial claims for jobless benefits will also be released.

Gold fell $2 to $1,694 an ounce, and oil gained 6 cents to $95.36 a barrel.

FedEx Corp. (NYSE: FDX), a barometer for the economy because it delivers goods, slid 2 percent after projecting its first decline in quarterly earnings in almost three years. Facebook Inc. (Nasdaq: FB) jumped 4.8 percent after Chief Executive Officer Mark Zuckerberg said he won’t start selling his holdings for at least a year. The Bloomberg U.S. Airlines Index soared 3.4 percent amid carriers’ improved performances.

“We’ve had this wait-and-see going on for three weeks now,” said Bruce Bittles, chief investment strategist at Milwaukee-based Robert W. Baird & Co., which oversees $85 billion. “The sellers are being held off from the anticipation of more quantitative easing. You don’t want to short or sell in front of that. On the other hand, the economy doesn’t seem to be able to make it, either domestically or globally. It’s really a standoff.”

The S&P 500 in August climbed to its highest level on an intraday basis in more than four years, then failed to close at that milestone. The index has fluctuated near the 1,400 level for three weeks as European leaders work to tame the region’s debt crisis and Federal Reserve Chairman Ben Bernanke said in Jackson Hole, Wyo., last week he wouldn’t rule out more stimulus.

ECB President Mario Draghi’s bond-buying proposal involves unlimited purchases of government debt that will be sterilized to assuage concerns about printing money, two central bank officials briefed on the plan said. To sterilize the bond purchases, the ECB will remove from the system elsewhere the same amount of money it spends, ensuring the program has a neutral impact on the money supply.

Draghi told the European Parliament this week that the ECB needs to intervene in bond markets to wrest back control of interest rates in the fragmented euro-area economy and ensure the survival of the common currency. Policymakers deliberated on the plan Wednesday, and Draghi will announce whether it has been agreed to at a press conference Thursday.

Stocks slumped as London-based Markit Economics said euro- area services and manufacturing contracted more than initially estimated in August. Separate data showed service industries in China expanded at a weaker pace last month as new orders slowed, and Australia’s economy slowed more in the second quarter than economists expected.

FedEx rival United Parcel Service Inc. (NYSE: UPS) also fell, losing 2.4 percent to $71.94. The Dow Jones Transportation Average, a gauge of 20 shipping companies, declined 1.1 percent. The index has dropped in five of the past seven trading sessions.

Utility and industrial shares posted the biggest declines out of 10 groups in the S&P 500, falling at least 0.4 percent. Commodity, telephone and consumer discretionary companies posted the largest increases. Walt Disney Co. (NYSE: DIS) jumped 2.3 percent to $50.79 for the biggest gain in the Dow.

Advanced Micro Devices Inc. (NYSE: AMD) sank 3.6 percent for the second-biggest decline in the S&P 500, to $3.51. The second-biggest maker of processors for personal computers was reduced to "neutral" from "buy" by UBS AG (NYSE: UBS).

Safeway Inc. (NYSE: SWY) rallied 4.3 percent to $16.50. The second-largest grocery chain in the United States is planning an initial public offering of a minority stake in its Blackhawk Network Holdings Inc. business. Blackhawk provides prepaid products, such as restaurant gift cards, to retail and grocery stores in the United States, Canada, Europe, Mexico and Australia.