12:30PM New York – U.S. stocks traded in a narrow range ahead of rate decision from the Fed.

Economic Reports and Data

December durable goods orders rose 5.2% to a seasonally adjusted $226.60 billion from November rate of 0.5% growth. November rate of growth was revised from a decline of 1% to a rise of 0.5%.

Orders excluding transportations rose 2.6% and transportation orders rose 11% in the month after gaining 2.6% in November. Defense related orders rose 81% and orders excluding it rose 2.9%.

The Conference Board reported a decline in consumer confidence in January to 87.9 from the revised reading of 90.6 in December.

The International Monetary Fund lowered its global economic growth outlook to 4.1% from 4.9% in 2007 on the weakness in the U.S. economic outlook. The forecast was lowered by 0.3% from its previous outlook issued in October.

Home prices in ten largest cities and metropolitan areas fell rapidly in November. The home prices in November fell 8.4% from a year ago after dropping 6.7% in October. The November read was the eleventh consecutive month of annual decline and prices are likely to continue further.

The narrow index that measures only the home price movement in the cities may exaggerate home prices declines than in the rest of the country. The home prices rose steeply in the cities during the last run between 2002 and 2006 and smaller towns and rural areas home prices did not increase that rapidly. Home prices have declined in the smaller towns as well but at a smaller pace.

Earnings News

Countrywide Financial (CFC: chart) reported a loss of $421.9 million in the fourth quarter or 79 cents a share. The company had guided investors a profit between 25 cents and 75 cents a share. The forecast from the company was widely ridiculed by analysts and consensus estimate surveyed by 123jump.com was a loss of 40 cents to 40 cents per share.

Countrywide lost $1.2 billion or $2.85 per share in the third quarter. The company, despite the loss, kept its dividend of 15 cents per share or $87 million.

American Express reported a profit decline of 9.9% to 71 cents per share from 75 cents per share a year ago on higher reserves for bad debt losses. The latest quarterly earnings includes $438 million in pre-tax credit related charges and $685 million related to a liabilities estimating method change. The return on equity rose to 37.3% from 34.7% from a year ago and total loan loss provisions increased 70% to $1.52 billion.

VMware (VM: chart) fell 33% after reported 80% rise in sales from a year ago to $412 million and earnings of $76 million, an increase of 72% from a year ago. The stock fell sharply on the lower than estimated revenue and weaker than expected earnings guidance of investor.

11:30AM New York – IMF lowered world economic growth outlook for 2008.

The International Monetary Fund lowered its global economic growth outlook to 4.1% from 4.9% in 2007 on the weakness in the U.S. economic outlook. The forecast was lowered by 0.3% from its previous outlook issued in October.

The IMF lowered its outlook for the U.S. economic growth from 2.2% growth to 1.5%.

IMF forecast may prove to be optimistic as only six months ago the IMF officials had dismissed the global implication of the sub-prime crisis in the U.S.

The Fund said that emerging economies are more “resilient” and likely to benefit from the rising domestic consumption, huge foreign exchange reserves, and growing consumer base.

China is expected to grow at 10% in 2008 from 11.4% in 2007 and Latin America is estimated to slow to 4.3% in 2008 from 5.4% in 2007.

The reports summarized, “A possibly deeper economic downturn in the United States or elsewhere could also serve to widen the crisis beyond the subprime sector, as credit deteriorates more broadly.

Already, delinquency rates in 2007 vintages of U.S. prime mortgages (those to the most credit worthy borrowers) are rising faster than in previous years, albeit from low levels, and other forms of consumer credit show signs of deterioration.