US: Wall Street edges higher as markets await Federal Reserve decision

[NEW YORK] Wall Street popped into positive territory late Tuesday after a largely flat trading day, with markets awaiting an interest rate decision from the Federal Reserve.

Equities also recovered somewhat from the damage done a day before, when weekend attacks on Saudi oil facilities drove stocks into the red on fears of rising crude prices and wider instability.

The benchmark Dow Jones Industrial Average rose 0.1 per cent to 27,110.80. The broader S&P 500 gained 0.3 per cent, settling at 3,005.70 while the tech-heavy Nasdaq rose 0.4 per cent to close at 8,186.02.

Fed policymakers opened their two-day meeting Tuesday after weeks in which Chairman Jerome Powell signaled a rate cut was likely amid weakening economic performance and mounting risks to growth.

Market voices on:

Maris Ogg of Tower Bridge Advisors told AFP a rate cut from the Federal Reserve on Wednesday was virtually assured.

“I think it’s near impossible that the Fed wouldn’t lower rates by 25 basis points,” she said. “They’ve signaled it extremely strongly.”

But she noted that the stronger than anticipated recent economic data could be a “bug in the ointment.”

The Fed reported Tuesday that industrial output had seen its biggest surge in a year last month, buoyed by large gains in manufacturing, which had fallen into recession in the first part of the year.

But on Tuesday afternoon, futures markets flipped their predictions, giving greater than even odds that the Fed is now more likely to hold its fire than cut rates.

Among individual companies, hardware and home improvement retail chain Home Depot was down 0.3 per cent after its stock was reportedly downgraded.


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