Wall Street opens higher as focus shifts to US Federal Reserve meeting

WASHINGTON (REUTERS) - Wall Street opened higher for the first time in five days on Wednesday as lower chances of an interest rate hike offered solace to investors amid jitters of Britain's possible exit from the European Union.

The Federal Open Market Committee (FOMC) will release a policy statement at 2:00 p.m. ET (2 a.m Thursday morning Singapore time). Fed Chair Janet Yellen is scheduled to hold a press conference at 2:30 p.m. ET.

Ms Yellen had hinted at higher chances of a rate hike than the markets had priced in, but weak May jobs data and economic repercussions of a possible Brexit forced her to take a dovish stance last week.

Traders see a less than 40 per cent chance of an interest rate increase until December, according to CME Group's FedWatch tool, but will focus on the course of future hikes.

In March, policymakers dialed back the number of rate hikes this year to two from four, citing weak global growth and financial market volatility.

The Fed raised its key overnight lending rate in December for the first time in nearly a decade. "At this point all eyes are on the Fed. The markets have been over-sold in the short-term ... and this would be a good place for them to rise, but the key is, will the markets be able to hold on to their gains after the Fed meeting and the conference," said Adam Sarhan, chief executive at Sarhan Capital. "If the markets can't bounce then that's an indication of how weak they actually are."

At 9:38 a.m. ET, the Dow Jones Industrial Average was up 35.58 points, or 0.2 per cent, at 17,710.4. The S&P 500 was up 4.45 points, or 0.21 per cent, at 2,079.77. The Nasdaq Composite was up 8.91 points, or 0.18 per cent, at 4,852.47.

Eight of the 10 major S&P sectors were higher, led by a 0.34 per cent rise in materials.