By Jeff Sanford

(June 27 – 14:30 ET) – With the opening of the FOMC meeting today, investors have largely stayed on the sidelines. Trading volume was relatively light on the TSE at 151 million shares. The TSE 300 composite index was down on the day. It dropped 61.88 points to end the day at 10,165.51.

Ten of the sub-indices were also lower. Communications and media and conglomerates were both down on the day. On the upside was minerals and metals which rose 2.28%.

Even though Research in Motion announced a deal with BT Cellnet to offer its BlackBerry e-mail device to British customers it lost $16 on the day. Corel announced that its graphics software is to be bundled with Hewlett-Packard scanners. That sent the embattled software makers stock up 27% to $6.75, still a bit off its 52-week high of $64.65.

The CDNX was also down on the day. It finished down 29.05 points at 3,430.07. The Canadian dollar closed at US67.53¢.

In the U.S., the story was much the same. The Dow meandered along in slightly positive territory for most of the day before sinking into the red in the afternoon. The Dow Jones industrial average ended the day at 10,504, down 38 points.

Part of the reason for the drop was a negative analyst report from Merrill Lynch on IBM’s second quarter results. Stock in Big Blue nosed down over US$3-1/2 today to finish at US$111-5/8.

Other movers were WorldCom, which was up US$1-9/16 to finish at US$39-1/16, and Sprint, up US$1-1/16 to US$59-5/8. Those gains came even though the U.S. Justice Department has announced that it will take action to stop the impending merger of the two telecom giants. European regulators are also threatening to step in over concerns that the merger would concentrate control of the Internet backbone on the hands of too few players.

The NASDAQ composite shed 53 points today to finish at 3,859 points. The S&P 500 edged down slightly to 1,450.55, a drop of 4.75 points.

With the consensus among economists that a rate hike isn-t in the offing Wednesday — the opinion being the Fed will prefer instead to wait until August before tightening again –attention will be focused on the tone of the policy statement. With a further rate increase likely in August, any relief rally following Wednesday’s announcement would be quick and muted.