(Corrects midday comment to change number of banks downgraded by S&P to 18 in bullet and lead paragraph
* FedEx tops Q4 estimates, but gives cautious outlook
* S&P cuts 18 banks on outlook for markets, regulation
* Obama unveils financial regulatory package
* Indexes mixed: Dow +0.05 pct; S&P -1.4 pct; Nasdaq +0.5 pct
* For up-to-the-minute market news click [STXNEWS/US] (Updates to midday)
By Chuck Mikolajczak
NEW YORK, June 17 (Reuters) - U.S. stocks were mixed on
Wednesday, weighted by a downgrade of 18 banks by Standard and
Poor's and a disappointing earnings outlook from economic
bellwether FedEx Corp
But the Nasdaq rose, lifted by Qualcomm Inc
S&P in its downgrade cited expectations of more difficult operating conditions because of volatile financial markets and tighter regulation. [ID:nLH666378]
Financial stocks fell, with the KBW Bank index <.BKX> down 4.7 percent.
Package delivery company FedEx
"FedEx is definitely throwing some water on the notion that the economy was turning," said Todd Clark, managing director of stock trading at Nollenberger Capital Partners in San Francisco.
"The market, having bounced so sharply from the March bottom, is needing to see some signs that maybe companies can grow their earnings other than just cutting costs."
Investors mulled details of the Obama administration's financial regulatory reform package, due to be announced later on Wednesday. U.S. President Barack Obama will present his proposals at 12:50 p.m. (1650 GMT).[ID:nN17113966]
The Dow Jones industrial average <.DJI> gained 4.61 points, or 0.05 percent, to 8,509.28. The Standard & Poor's 500 Index <.SPX> dropped 1.43 points, or 0.16 percent, to 910.54. The Nasdaq Composite Index <.IXIC> added 8.39 points, or 0.47 percent, to 1,804.57.
Qualcomm rose 3.1 percent to $44.80 while Texas Isntruments gained 3.3 percent to $21.41. (Additional repoting by Rachel Chang; Editing by Padraic Cassidy)