Stocks close near opening levels amid Fed rate cut uncertainty
Stocks finished close to where they started Tuesday, shedding positive momentum from earlier in the day as investors expressed uncertainty over the size of the Federal Reserve’s expected rate cut, set to be announced Wednesday at the conclusion of the widely anticipated policy meeting. The Dow Jones Industrial Average and the S&P 500 lost about 0.2%, backtracking from earlier in the day when they were at or near record levels. The Nasdaq Composite finished just above the flatline.
Investors speculate on Fed rate cut ahead of decision
Wall Street is abuzz with speculation on the odds of a 0.5% Fed rate cut. With just one day to go before officials reveal their monetary policy decision, traders see odds of 65% on a 50 basis point reduction in rates. The central bank’s two-day meeting, which began Tuesday, is expected to bring the first easing in rates since early 2020, although the size of the rate cut remains uncertain. Traders also keep an eye on how the market will react to the first rate cut.
Retail sales surprise positively in August
Retail sales surpassed Wall Street’s estimates in August, rising 0.1% despite expectations of a 0.2% decline. Investors are watching for any signs of a slowdown in consumer spending, as this data may influence the Fed’s decision on whether to opt for a substantial rate cut. The reading is the last piece of data that could factor into the Fed’s thinking on their interest rate move.
Market trends on Tuesday afternoon
Stocks trended in the afternoon with Intel stock popping after securing Amazon as a multibillion-dollar customer for AI chips. Microsoft’s new plan to buy back shares and boost dividends also boosted faith in battered tech stocks. Here are some of the stocks leading Yahoo Finance’s trending tickers page during afternoon trading on Tuesday:
- Microsoft (MSFT)
- Hewlett Packard Enterprise (HPE)
- Accenture (ACN)
- Intel (INTC)
Homebuilder confidence rises ahead of expected rate cut
Homebuilders are feeling more confident about the housing market as mortgage rates sit at their lowest level since February 2023. The National Association of Home Builders’ Housing Market Index rose two points in September, breaking a streak of monthly declines. The gauge of the sales outlook over the next six months also rose, indicating a positive view for future new home sales.
Source : finance.yahoo.com