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Pre-Market Primer: Dish Network Corp Drops Sprint Nextel Corporation Bid; All Eyes Are on the Fed


Markets are calm ahead of Fed announcement.

Futures fluctuated today as investors await the Fed's decision with regards to cutting back on asset purchases.

With an empty economic calendar, the Federal Reserve's Open Market Committee announcement, economic forecasts, and Ben Bernanke's subsequent press conference will dominate the markets' attention.

Many analysts remain doubtful that the Fed will cut back on its $85 billion monthly asset purchases. Last month, it said that it might scale back quantitative easing as early as June. The chairman's press conference at 2:30 p.m. will be searched for indications of the Fed's leanings for next month.

Futures are hardly changed before the opening bell. Dow (INDEXDJX:.DJI) futures were down 0.07% at 15,234. Futures contracts on the S&P 500 (INDEXSP:.INX) inched up 0.01% to 1,645.30 and Nasdaq (INDEXNASDAQ:.IXIC) futures rose 0.15% to 2,993.00.

Japanese shares advanced 1.8% overnight. The latest economic report from the country shows that 'Abenomics' is indeed helping a revival in exports, which rose 10.1% year-over-year in May after rising 3.8% in the month earlier. Import demand also rose 10% as consumers and businesses grew more confident. Chinese shares declined slightly. HSBC cut the country's growth prediction to 7.4% from 8.2%.

Economic bellwether FedEx Corporation (NYSE:FDX) reported earnings per share of $2.13, up from $1.99 a year earlier. This result beat earnings expectations of $1.95 per share. Revenue came in at $11.4 billion, up from $11 billion in last year's fiscal fourth quarter.

FedEx Chairman and CEO Frederick Smith said that improved margins "did not fully offset tepid economic growth and customer preference for less costly international shipping services."

The transportation and logistics company expects earnings to rise 7%-13% in fiscal 2014 versus the 2013. Shares moved between gains and losses in the pre-market.

Dish Network Corp (NASDAQ:DISH) said yesterday that it is dropping its bid for Sprint Nextel Corporation (NYSE:S), essentially green-lighting Softbank Corp's (TYO:9984) 78% takeover. It will not, however drop its pursuit of a big minority position in Clearwire Corporation (NASDAQ:CLWR), which Sprint has a large stake in. An alliance with Clearwire could help Dish Network someday form a 4G wireless network. Softbank shares rose 4.2% in Tokyo trading overnight, and Sprint shares fell 2.73%.

Tesla Motors Inc (NASDAQ:TSLA) shares fell 1.6% in the premarket after it recalled 800 Model S vehicles.

Shares of Adobe Systems Incorporated (NASDAQ:ADBE) rose nearly 7% in after-hours trading after reporting better-than-expected earnings. A surge in customers for Creative Cloud, the cloud and subscription-based version of the Creative Suite graphics programs, rose by 221,000 to 700,000.

Protests continued in Brazil through last night as tens of thousands demonstrated in Rio de Janeiro. The protests, which began over gripes about a bus fare hike, are drawing critics of the country's expensive preparations for two international sporting events while infrastructure languishes and quality of life deteriorates.

Twitter: @vincent_trivett
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