By Anna Isaac 

-- Treasury yields tick lower

-- Repo markets calm after intervention

-- U.S. stock futures edge down

Global stocks paused ahead of an interest-rate decision from the Federal Reserve, amid political tensions and a volatile week for oil prices.

In the U.S., futures on the Dow Jones Industrial Average and S&P 500 were down 0.1% and 0.2%, respectively. The contracts don't necessarily predict movements after the opening bell.

The Fed on Tuesday had to step in to address a problem in money markets. It was the first time since 2008 that the central bank had to inject cash to keep interest rates down for short-term borrowing, and it is unclear how long the market intervention will last.

The easiest fix "would be to revive quantitative easing (QE), to create excess reserves," said Bastien Drut, senior strategist at CPR Asset Management, in a note. This would "ease the tensions on the interbank market," he said, adding the impact of such a move on financial markets would be "very strong" and trigger a depreciation of the U.S. dollar.

On Tuesday afternoon, the Fed said it would inject a further $75 billion Wednesday morning to ease the cost of overnight borrowing.

Shares of FedEx Corp. dropped 10.8% in off-hours trading after the delivery firm late Tuesday reported a sharp fall in its profit forecast.

The Stoxx Europe 600 edged up 0.1% in midday trading after a mixed session in Asia. The Shanghai Composite rose 0.3% and Korea's Kospi gained 0.4%, while Japan's Nikkei slipped 0.2%.

Japan's exports dropped 8.2% on year last month, a more rapid fall than expected, adding to speculation that the central bank may seek to cut interest rates deeper into negative territory. The weak data came as global uncertainty has boosted the yen, regarded as a haven by investors, by around 1.4% against the U.S. dollar so far this year.

Global oil benchmark Brent crude slipped 1% to $63.93 on Wednesday, following days of sharp swings after an attack on production facilities in Saudi Arabia. The tick downward came after the Saudi energy ministry said the kingdom would recover output in weeks.

The attack caused the Brent price to rise 15% on Monday, the biggest leap in a single day since 1988, before dropping back by 6.5% on Tuesday. The volatility spread to other asset types, including junk bonds. Energy firms account for about 6% of debt outstanding in the high-yield market.

Meanwhile, the Federal Reserve later Wednesday is expected to cut its short-term benchmark interest rate by a quarter percentage point, following a cut of the same amount in July. The central bank is seeking to balance domestic concerns, such as a relatively tight labor market, against a slowdown in global trade.

"Whatever has happened in the last week or two hasn't changed my view that there will be a 25 basis-point cut today. To not introduce a cut would introduce volatility to the market that it can't afford," said Seema Shah, chief strategist at Principal Global Investors.

After its Wednesday meeting, the Fed is also expected to release more details on the likely future course of interest rates.

Data on construction in the U.S. was also released Wednesday. The figures showed home building had risen last month to the highest level since June 2007, following three straight months of decline.

The yield on 10-year U.S. Treasurys ticked down to 1.779%, from 1.805% Tuesday. Yields fall as bond prices rise.

Gold prices slipped 0.3%.

Write to Anna Isaac at anna.isaac@wsj.com

(END) Dow Jones Newswires

September 18, 2019 09:14 ET (13:14 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.