U.S. stocks were little changed in early trading on Wednesday as investors cooled their heels ahead of a Federal Reserve policy statement.

With the Fed likely to keep interest rates unchanged, investors will focus on whether the central bank will signal any change in a policy that has flooded markets with cheap money. The Fed's statement is expected around 2:15 p.m. EDT.

The Fed will likely say it is encouraged by signs of recovery, but it is just a budding recovery that needs the lubricant of low interest rates to continue, said Jim Awad, Managing Director at Zephyr Management in New York.

They are going to walk right down the middle. I think they might be a touch more optimistic about the economy but not enough to rattle the markets either way.

The biggest price movers in stocks were related to specific announcements from industry bellwethers, and trading was expected to be subdued with the Fed's statement looming.

The Dow Jones industrial average <.DJI> dropped 8.61 points, or 0.09 percent, to 9,821.26. The Standard & Poor's 500 Index <.SPX> fell 0.85 point, or 0.08 percent, to 1,070.81. The Nasdaq Composite Index <.IXIC> edged up 0.86 point, or 0.04 percent, to 2,147.16.

General Mills Inc shares rose 5 percent to $64 after the maker of Cheerios cereal posted a higher-than-expected quarterly profit, helped by strong sales in the United States and lower commodity costs.

Chip maker Xilinx Inc shares jumped 4.9 percent to $23.84 after the company lifted its sales guidance for the second-quarter.

Ford Motor Co shares rose 5.7 percent to $7.41 after it said it will start production of a small car in India early next year. The company's chief executive said the U.S. market was showing signs of recovery, and he expected industry sales to rise in the next two years.

Declining shares included AMR Corp , which dropped 6.4 percent to $7.90, and US Airways Group Inc , off 13.4 percent to $4.53, as the companies launched share sales to raise money for general corporate purposes. An airline index <.XAL> tumbled 3.4 percent.

(Editing by Padraic Cassidy)