San Francisco Frontiers - Stock markets hold largely steady before Fed rate meeting

In New York, the Dow, the S&P 500 and Nasdaq were down by 0.1 percent or less after the open as investors avoided bets ahead of the Fed's announcements later Wednesday.

European markets were mixed in afternoon deals.

Paris' luxury-heavy CAC 40 index was the worst performing major stock market after French giant and Gucci-owner Kering issued a profit warning over weak Chinese demand.

"This is causing concern that other luxury houses could see a similar downturn in demand from this important market," said Kathleen Brooks, an analyst at XTB.com.

"Analysts have been revising down their profit estimates for Europe's textiles and apparel sector, and this could weigh on luxury stocks in the medium term," she said.

Kering shares slid as much as 15 percent in Paris and was heading towards its worst decline ever.

Burberry shed nearly four percent in London. LVMH was two percent down in Paris and Hermes was little changed.

London stocks were largely flat even though UK inflation fell more than expected, fuelling speculation that the Bank of England could start cutting its key rate in June rather than later in the year.

- Focus remains on Fed -

Fed policymakers are widely expected to announce that they are holding US rates at a two-decade high, but traders will be closely watching the "dot plot" of projections for how many cuts they see this year.

"Analysts will pounce on this to see how much it may differ from the last one in December, both in terms of the timing of the first rate cut, and also where the Fed Funds rate may be by the end of this year," said David Morrison, analyst at Trade Nation.

"The current market expectation is that the first cut will be in June, and for the Fed Funds rate to have an upper limit of 4.75 percent by year-end."

Analysts are forecasting the Fed to begin cutting rates from June -- having massively hiked borrowing costs along with other central banks to tackle soaring consumer price inflation.

In December, the Fed was projecting a total of three cuts this year but there are worries policymakers could be spooked into lowering their outlook to just two and maybe even delaying the first cut because of recent reports indicating inflation is stickier than anticipated.

The continued health of the US jobs market is also lifting pressure off Fed to ease its monetary stance.

In the eurozone, European Central Bank President Christine Lagarde warned of the risk of acting "too late" on interest rate cuts, reaffirming the likelihood that the first reduction in the bloc's borrowing costs would come in June.

"We cannot wait until we have all the relevant information," Lagarde said at a conference in Frankfurt.

But she also declined to pre-commit to an interest rate path once that first cut has been made.

- Key figures around 1340 GMT -

New York - Dow: DOWN 0.1 percent at 39,059.79 points

New York - S&P 500: DOWN 0.1 percent at 5,172.83

New York - Nasdaq Composite: DOWN less than 0.1 percent at 16,160.13

London - FTSE 100: DOWN less than 0.1 percent at 7,735.99

Paris - CAC 40: DOWN 0.6 percent at 8,151.49

Frankfurt - DAX: UP 0.1 percent at 18,000.80

EURO STOXX 50: DOWN 0.2 percent at 4,999.35

Hong Kong - Hang Seng Index: UP 0.1 percent at 16,543.07 (close)

Shanghai - Composite: UP 0.6 percent at 3,079.69 (close)

Tokyo - Nikkei 225: Closed for holiday

Dollar/yen: UP at 151.77 yen from 150.88 yen on Tuesday

Euro/dollar: DOWN at $1.0841 from $1.0867

Pound/dollar: DOWN at $1.2692 from $1.2721

Euro/pound: UP at 85.43 pence from 85.40 pence

West Texas Intermediate: DOWN 1.6 percent at $82.10 per barrel

Brent North Sea Crude: DOWN 1.3 percent at $86.24 per barrel

L.Ramos--SFF