Stocks Little Changed as Investors Play It Safe Ahead of the Fed
September 19 2017 - 10:31AM
Dow Jones News
By Marina Force
U.S. stocks wavered Tuesday, as investors held back from making
major moves ahead of the Federal Reserve's policy decision this
week.
The Dow Jones Industrial Average gained 19 points, or 0.1%, to
22351 shortly after the opening bell. The S&P 500 added less
than 0.1%, while the Nasdaq Composite fell less than 0.1%.
Major U.S. indexes have mostly drifted higher in recent trading
sessions, with the S&P 500 and Dow industrials rising to fresh
records together Monday.
Some analysts attributed the lull in the stock market to
investors holding off on bets ahead of the Fed's upcoming policy
announcement.
Many expect the central bank to announce Wednesday that it will
keep rates unchanged and that it will start slowly unwinding its
$4.5 trillion balance sheet.
"It's not rare to see the markets in a pause mode just before an
important meeting," said Patrick Zweifel, chief economist at Pictet
Asset Management.
Subdued inflation readings have made many investors skeptical
the Fed will raise rates for a third time this year.
"The data that has been coming out from the U.S. has been a bit
of a mixed bag...so I think it is maybe time for the Fed to take a
break," said Trip Miller, managing partner at Gullane Capital
Partners, who doubts the central bank will increase rates again
this year.
However, data last week showing a bigger-than-expected jump in
U.S. consumer prices gave a fresh boost to investor expectations
for one more rate rise in 2017.
Federal-funds futures, used by investors to place bets on the
Fed's rate-policy outlook, showed Tuesday a 57% chance that the
central bank will raise interest rates again by December, according
to CME Group data, up from a 41% chance a week ago.
U.S. government bond prices strengthened on Tuesday, with yield
on the benchmark 10-year U.S. Treasury note recently at 2.214%,
according to Tradeweb, compared with 2.230% on Monday. Yields fall
as bond prices rise.
Elsewhere, the Stoxx Europe 600 was flat in early afternoon
trade, with the biggest losses in the food and beverage sector.
Markets in Asia closed mixed, with Japan's Nikkei Stock Average
jumping 2% to its highest close since August 2015 and Hong Kong's
Hang Seng Index falling 0.4%.
Michael Wursthorn and Kenan Machado contributed to this
article.
(END) Dow Jones Newswires
September 19, 2017 10:16 ET (14:16 GMT)
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