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Fed's rate decision expected at 2:00 p.m. ET

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Birkenstock ( BIRK ) up after beating estimates for Q4 results

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Merck ( MRK ) gains after signing up to $2 bln obesity drug deal

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Futures up: Dow 0.42%, S&P 500 0.30%, Nasdaq 0.22%

(Updates before markets open)

By Lisa Pauline Mattackal and Purvi Agarwal

Dec 18 (Reuters) -

Wall Street's main indexes were poised for a higher open on

Wednesday, as investors were optimistic about the Federal

Reserve's final rate decision of the year and awaited signals on

whether policymakers will take a more cautious stance in 2025.

The Fed is widely expected to reduce interest rates by 25

basis points at its meeting. The announcement is expected at 2

p.m. ET on Wednesday.

With a rate cut broadly priced in, the Fed's summary of

economic projections (SEP), which includes the "dot plot" of

rate projections, and comments from Chair Jerome Powell will be

in focus for indications on the rate path in 2025.

"The question is more about what happens next and what's

the rhetoric around 2025. Powell's really guided markets in a

pretty safe (way) and kind of kept them stable enough to

continue the upward trajectory in 2022, and we expect today to

be similar," said Keith Buchanan, senior portfolio manager,

Globalt Investments.

"We expect two cuts in 2025, that's down from a few

months ago. The market is starting to grapple with that

happening."

Wall Street's main indexes had dipped in Tuesday's session,

with the Dow notching its ninth straight daily decline, its

longest losing streak since February 1978, as markets

increasingly look for a more hawkish Fed next year on the back

of strong growth and persistent inflation limiting the case for

steady rate cuts.

U.S. Treasury yields have ticked higher with the change in

Fed expectations, with the 10-year yield up past

4.4%.

Most rate-sensitive megacap stocks ticked higher in

premarket trading, with AI giant Nvidia ( NVDA ) up 2.5% after

hitting an over two-month low on Tuesday.

Tesla, meanwhile, dropped 1.9% after rising over

14% in the last three sessions.

At 8:25 a.m. ET, Dow E-minis were up 181

points, or 0.42%, S&P 500 E-minis were up 18 points, or

0.30% and Nasdaq 100 E-minis were up 48.75 points, or

0.22%.

Still, despite some jitters over future Fed policy, stocks

are on track to end the year strong with the S&P 500 up nearly

27%, the Nasdaq up nearly 34% and the Dow up over 15%.

The rally has been fueled by technology companies that

capitalized on the euphoria around artificial intelligence, the

prospects of a lower rate environment and hope of pro-business

policies from the incoming Donald Trump administration.

Crypto-focused stocks slipped as bitcoin fell 1.3%.

MARA Holdings ( MARA ) and Riot Platforms ( RIOT ) down 1.2%

each.

Birkenstock ( BIRK ) advanced 4.8% after beating market

expectations for fourth-quarter results, helped by robust

full-price sales of the footwear maker's pricey sandals in the

U.S. and Asia.

Merck ( MRK ) gained marginally after the drugmaker signed a

deal worth up to $2 billion with Hansoh Pharmaceuticals

to develop and commercialize the Chinese biotech's

experimental obesity drug.

General Mills ( GIS ) fell 4.4% as the Cheerios maker

slashed its annual profit forecast, while Jabil ( JBL ) jumped

9.6% after the electronic components maker beat estimates for

first-quarter results.