Traders are at work on the New York Stock Exchange on December 17, 2024.
New York Stock Exchange
the Dow Jones Industrial Average It rose slightly on Wednesday as traders eyed the Federal Reserve's interest rate decision in December.
The Dow Jones index rose by about 134 points, or 0.3%. Tuesday, Dao The Dow Jones fell 267.58 points, or 0.61%, for a nine-day losing streak, its longest since 1978. If the Dow falls for a 10th day on Wednesday, it will be its worst losing streak since its 11-day decline in 1974.
the Standard & Poor's 500 It rose by 0.1%. the Nasdaq Composite It rose by 0.08%.
The Dow's worst disarray in 46 years was mostly caused by the shift from old-economy stocks to technology stocks, a sector the sector has benchmarked against broader market metrics for a century. Despite this streak, the Dow Jones is sitting less than 4% from its all-time high. Other market metrics held up this month, with the S&P 500 rising into the green for December and holding about 1% from its all-time high. The Nasdaq rose 4.6% this month as investors flocked to technology stocks, while avoiding the Dow Jones.
The Fed's policy decision is scheduled for 2:00 PM ET. Trading in Fed funds futures currently shows a 95% chance the central bank will cut interest rates by a quarter of a percentage point, according to the CME FedWatch tool.
Investors will also pay close attention to Fed policymakers' summary of economic forecasts and Fed Chairman Jerome Powell's press conference, looking for clues about what might happen in the coming months. The central bank is widely expected to temper expectations for further interest rate cuts next year, especially as inflation remains stubborn.
“I think we'll get a cut… but I think the language and the tenor will probably be as hawkish as we've seen from Powell for a while,” said Ross Mayfield, investment strategist at Baird. “Although they will not act on policy that has not yet been established, I think they will be a little reluctant to commit to, say, four-fold rate cuts in 2025 when there is so much instability.”
In contrast, hawkish comments on Wednesday could push stocks into a sell-off. But Mayfield added that he is optimistic that the volatility surrounding Fed meetings does not usually last for long.
“We've seen some big moves on days where the Fed has announced a policy change and how that happens — and those moves have later been reversed, or gains have been rolled back or losses have been cut later. So I'm not too concerned about that.” “What will happen in the immediate aftermath tomorrow,” he added.
Nvidiawhich fell into correction territory earlier this week, was bouncing in Wednesday trading, up nearly 3%. Nvidia entered the Dow Jones last month. Shares of Broadcom, which saw big inflows this month as investors dumped Nvidia, fell in early trading on Wednesday.
