Wall Street stocks rose on Wednesday in the wait to find out whether the Federal Reserve will hold interest rates steady as expected at the wrap-up of its meeting later.
At the open, the Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) both gained about 0.2%, after the benchmarks closed lower on Tuesday. The tech-heavy Nasdaq Composite (^IXIC) was up around 0.1%, after tech stocks lost ground in the previous session as Instacart’s IPO rally lost some momentum.
Traders overwhelmingly believe the Fed won’t hike rates, pricing in a 99% chance of a pause in its tightening campaign, according to the CME FedWatch Tool. The focus is instead on what happens in the future: whether it will return to raising borrowing costs this year, and when a rate cut could be on the cards.
Given that, the focus will be on what the central bank’s “dot plot” signals about the future path of rates, and what hints can be gleaned from Fed Chair Jerome Powell’s comments.
The recent soaring rally in oil prices, seen by some as a risk to the Fed’s efforts to cool inflation, pulled back somewhat on Wednesday as investors weighed how its policy decision might affect economic growth and fuel demand. Brent crude (BZ=F) and WTI crude (CL=F) futures were down about 0.7%, but analysts are still concerned prices might be headed above $100.
In another sign of a reviving US IPO market, Klaviyo (KVYO) is set to make its debut on Wednesday, on the heels of debuts by Arm (ARM) and Instacart. The marketing automation company has priced its offering above range at $30 a share, for a valuation of $9.2 billion.
Elsewhere, an unexpected slowdown in UK inflation boosted the odds that the Bank of England will pause increasing interest rates after making one last hike on Thursday. The British pound dropped after the August inflation report.
Stocks open higher ahead of Fed meeting
Stocks were in the green Wednesday morning as investors awaited the latest policy decision from the Federal Reserve set for 2 p.m. ET. While the central bank is widely expected to hold interest rates steady investors’ focus will be on what the Fed projects for future rate hikes.
The Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) popped about 0.2%. Meanwhile the tech-heavy Nasdaq (^IXIC) rose just above the flat line.
Instacart, Pinterest, and General Mills: Stocks trending in premarket trading
Here are some of the stocks leading Yahoo Finance’s trending tickers page in premarket trading on Wednesday:
Instacart (Maplebear Inc.) (CART): Shares for the grocery delivery business were down by 4%. On Tuesday, Instacart went public on the Nasdaq. Its stock opened around $42 a share, some 40% higher than the anticipated $30, but pared gains before ending up about 12%.
Pinterest (PINS): The image-sharing and social media service saw its share price rise by 4%. On Tuesday, it announced the appointment of Scott Schenkel, former chief financial officer and interim CEO of eBay, to its board.
General Mills (GIS): Shares in Cheerios maker General Mills rose by 1% after it topped quarterly sales as price hikes on its products helped cushion a slowdown in demand.
Dollar General (DG): Shares fell by 1%. A report from Bloomberg on Wednesday documented poor working conditions at the retailer’s stores.
Stock futures rise with Fed in focus
Stocks on Wall Street pointed to a higher open ahead of the Federal Reserve policy decision later Wednesday, with traders convinced policymakers will hold interest rates steady.
Futures tied to the Dow Jones Industrial Average (^DJI) were up 0.20%, or 68 points, while S&P 500 (^GSPC) futures advanced 0.17%. Nasdaq 100 futures moved up 0.13%
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