* Fed minutes expected at 2:00 p.m. ET
* Yahoo up after sharp selloff on Tuesday
* Target up after results
* Pep Boys up after report of takeover approach
* Futures: Dow up 8 pts, S&P down 0.25 pts, Nasdaq up 2.75 pts (Adds details, comment, updates prices)
By Tanya Agrawal
May 20 (Reuters) - Wall Street was set to open little changed on Wednesday with investors cautious ahead of the release of minutes from last month’s Federal Reserve meeting, which is expected to shed light on when interest rates will be hiked.
The central bank has said it will raise rates only when data suggests that the economy is strengthening. Growth slowed to a crawl in the first quarter.
Recent data has painted a mixed picture. Consumption, business spending and manufacturing data has suggested the economy is struggling, but housing starts were strong.
While the Fed is broadly expected to raise rates this year, the timing of the move has kept the market on tenterhooks.
“There is a consensus that the Fed probably doesn’t move until September and I don’t think that will change today,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.
The latest Reuters survey showed most economists were now less convinced about when rates would be increased, but the median still suggested a move in the third quarter.
A rate hike is not likely to be appropriate until early 2016, Chicago Fed President Charles Evans said on Wednesday.
The minutes of Fed’s April meeting are expected to be released at 2:00 p.m. ET (1800 GMT).
The Dow Jones industrial average closed at a record high for the second straight day on Tuesday. Earlier in the session, it hit an all-time intraday high of 18,351.36.
“If interest rates were to go up sharply, then yes, the markets are overvalued, but that’s not going to happen,” said Hogan.
S&P 500 e-mini futures were down 0.25 points and their fair value - a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract - indicated a flat open.
Dow Jones industrial average e-mini futures rose 8 points and Nasdaq 100 e-mini futures added 2.75 points.
Yahoo Inc gained 2.9 percent to $42.20 premarket after the company said a potential change in tax rules on spinoffs was not specific to its plan to spin off its stake in Alibaba. The stock fell 7.6 percent on Tuesday.
Target rose 1.4 percent to $79.01 after it reported a larger-than-expected increase in profit and raised the lower end of its full-year earnings forecast range.
Lowe’s fell 6 percent to $67.50 after reporting lower-than-expected quarterly profit and sales.
Etsy, which went public last month, slumped 19.2 percent to $16.96 after the company posted a bigger loss.
Pep Boys Manny Moe and Jack rose 14.4 percent to $10.59 on a report that the auto parts retailer had received takeover approaches.
Sarepta Therapeutics soared 47.3 percent to $24.13 on plans to file for a marketing application for its muscle drug.
NetApp and Salesforce.com will report after the close. (Editing by Savio D‘Souza)