The index futures are slightly higher early Wednesday as traders turn defensive ahead of the all-important Federal Reserve meeting of the year. As is characteristic of a Fed decision day, stocks could mostly move sidewards in a narrow range until the rate decision is announced. The trading direction will likely depend on several factors, including any changes in the Fed’s language in the post-meeting policy statement, the growth, inflation, and rate forecasts provided in the Summary of Economic Projections, and Chair Jerome Powell‘s comments during the subsequent press conference.
While the betting and futures market suggests a 50 basis point could be on the table, most economists are resigned to a more modest 25 bps cut. Some strategists even worry a bigger cut could be interpreted as a confession from the central bank that the economic conditions are a cause for concern.
Futures
Performance (+/-)
Nasdaq 100
+0.17%
S&P 500
+0.14%
Dow
+0.16%
R2K
+0.17%
In premarket trading on Tuesday, the SPDR S&P 500 ETF Trust (NYSE:SPY) added 0.10% to $563.66 and the Invesco QQQ ETF (NASDAQ:QQQ) gained 0.11% to $473.99, according to Benzinga Pro data.
Cues From Last Session:
On Tuesday, a stronger-than-expected increase in August retail sales set in motion a strong buying wave, which, however, could not be sustained in the afternoon session. As a result, the major indices ended narrowly mixed. The S&P 500 rose for a seven straight session, hitting an intra-day high amid the early buying. The broader gauge, however, came off the high and ...
