U.S. MARKET AVERAGES

U.S. stocks opened lower Tuesday ahead of the Fed Reserve’s decision on interest rates at the policy makers' final meeting under Alan Greenspan''s leadership.

The Federal Open Market Committee is expected to announce that it''s raising its key interest rate by a quarter point to 4.5%, the 14th straight rise.

In earnings news, Dow components, Merck and Altria posted unimpressive earnings reports. Pharmaceutical company Merck & Co. (MRK), a Dow component, reported fourth-quarter earnings were up slightly, while drug maker Sepracor Inc (SEPR) posted Q4 profit above expectations. Altria Group Inc. (MO) reported fourth-quarter earnings rose but forecast a decline in 2006 earnings due to restructuring charges at its Kraft Foods Inc.

Google’s fourth-quarter earnings report is due at the close of trading. Analysts expect Google to post nearly 100% profit rise, or $1.76 a share on sales of $1.29 billion. Separately, the company is considering an alliance with Napster Inc. that could lead to an outright acquisition.

Insurance stocks moved to the downside , dragged by UnumProvident (UNM), falling by more than 13% on earnings released after Monday''s close. The housing sector showed weakness in the opening hours, reversing some of the gains it posted on Monday.

The airline sector posted strength in early trading, climbing by about 1.2% with AMR (AMR) up by another 3.4% and Continental (CAL) higher by 5.7%. The gold sector stood out among among early gainers, rising by about 1.9%.

The Dow Jones industrial average is down 8.56 at 10,891.36. The Nasdaq Composite has fallen 2.26 to 2,304.52. And the Standard & Poor''s 500 index is off 1.84 at 1,283.36.

MOVERS AND SHAKERS

Waddell & Reed Financial (WDR) reported Q4 net income decline of $19.9 million, or 24 cents a share, down from $25.7 million, or 31 cents a year ago, missing estimates of 30 cents a share on revenue of $163 million. Revenue rose 11.1%, reaching $163.1 million from $146.9 million, paced by growth in investment-management fees. The stock dropped 6%.

Altria Corp (MO) reported Q4 earnings from continuing operations of $2.29 billion, or $1.09 a share, up from a year-ago equivalent profit of $1.99 billion, or 96 cents a share on 9.4% revenue growth, missing estimates for a profit of $1.17 a share. For fiscal 2006 the company sees earnings from continuing operations of $4.85 to $4.95, excluding expected restructuring charges. The stock fell 1.1%.

Napster (NAPS) surged 44% following a report in the New York Post that Google is considering an alliance with the digital music company that could lead to an outright acquisition.

Sepracor Inc (SEPR) swung to a Q4 profit of $37.2 million, or 32 cents a share, exceeding expectations of 5 cents a share. Revenue soared to $311 million from $131 million, on sales of Xopenex and Lunesta medications. For 2006 the company projected earnings of $1.50 a share on revenue of $1.275 billion. The stock rose 14.5%.

ECONOMIC NEWS

The Conference Board released its report on consumer confidence in the month of January on Tuesday, showing that confidence improved more than economists had been expecting. The Consumer Confidence Index rose to its highest level in more than three years.

The report showed that the Consumer Confidence Index rose to 106.3 in January from an upwardly revised 103.8 in December. Economists had expected the index to increase to 105.0 compared to the 103.6 originally reported for December.

The Conference Board's Present Situation Index rose to 128.4 in January from 120.7 in December, with those claiming conditions are good increasing to 25.8 percent from 24.4 percent.

The increase was partly due to continued improvement in the assessment of the labor market, with those saying jobs are plentiful rising to 26.9 percent in January from 23.3 in December. Those claiming jobs are hard to get decreased to 20.3 percent from 22.5 percent.

INTERNATIONAL MARKETS NEWS

Asian-Pacific benchmarks finished mostly higher with only four bourses actively trading Tuesday as many regional markets were closed for an extended Lunar New Year holiday. The Nikkei continued its march upward with an advance of 0.6% to 16,649.82, lifted by expectations of strong earnings from key industrial stocks. South Korea’s Kospi climbed 1.1%, Thailand’s SET index gained 0.4%, while Australia’s All Ordinaries lost 0.3%.