Stock market today: Indexes close mixed as tech stumbles and traders brace for Fed meeting
In this May 22, 2020, file photo, a car drives past the Federal Reserve building in Washington.
Stocks close mixed on Monday as traders and investors prepared for the start of the Federal Reserve’s highly anticipated policy meeting.
The Federal Open Market Committee, the Fed’s rate-setting group, is expected to deliver an interest rate cut at 2 p.m. on Wednesday. Odds have risen for a larger, 50 basis point cut following a slightly hotter monthly reading of the core consumer price index for August. Markets see 61% odds of a 50-basis-point move, versus 39% for a quarter-point move.
The stock market has been eager for rates to come down, and Wednesday’s meeting will be the culmination of months of waiting and speculation over what the central bank might do as inflation ebbs closer to its 2% target.
Yet, analysts have struck a note of caution even as lower borrowing costs are broadly expected to be bullish. A growing chorus of market strategists have been telling investors to start playing defense and avoid being lured into high-flying tech trades tied to the promise of artificial intelligence.
On Monday, Bank of America stock strategy chief Savita Subramanian echoed that sentiment, noting that “boring” stocks are a good bet, and that investors should seek out dividend-paying shares in areas like financials and real estate.
Here’s where US indexes stood shortly after the 9:30 a.m. opening bell on Monday:
- S&P 500: 5,633.09, up 0.1%
- Dow Jones Industrial Average: 41,622.08, up 0.6% (228 points)
- Nasdaq composite: 17,592.13, down 0.5%
Tech shares took a hit on Monday. Apple slid almost 3% after an analyst warned of weaker iPhone demand compared to last year’s release.
The Nasdaq Composite pared some losses to end more than 0.5% lower, fueled by the sell-off in Apple shares as well as declines among major chip firms including Broadcom, Nvidia, Super Micro Computer, and Micron Technology.
Here’s what else is going on:
- Morgan Stanley laid out the best-case scenario for this week’s Fed decision — and named two places to buy.
- Russia’s oil revenue has plunged to the lowest in months amid the fall in global oil prices.
- “The oracle of Wall Street” says Gen Z and millennials are propping up the economy — with help from their parents.
In commodities, bonds, and crypto:
- Oil futures rose. WTI crude increased 2.5% to $70.42 a barrel. Brent crude, the international benchmark, rose 1.8% to $72.92 a barrel.
- Gold was about flat at $2,608 an ounce.
- The 10-year Treasury yield fell two basis points to 3.625%.
- Bitcoin dropped 5%, trading at $58,070.
