NEW YORK: Wall Street’s main indexes moved higher on Wednesday ahead of the Federal Reserve’s widely anticipated monetary policy decision, at a time when worries linger about trade policies and their impact on the economy.
The central bank is expected to leave its benchmark overnight interest rate unchanged in the 4.25%-4.50% range, when it releases its policy statement at 2 p.m. ET (1800 GMT). Traders see the Fed lowering borrowing costs by at least two 25-basis point cuts by December, with the first expected in July, according to data compiled by LSEG.
Focus will be on new economic projections from policymakers that will give an idea of how they feel US President Donald Trump’s policies will affect economic growth, inflation and unemployment. Fed Chair Jerome Powell is scheduled to speak later in the day.
“We see an increasing likelihood for a weaker payrolls report over the next few months that ultimately leads to a Fed rate cut at the June meeting,” said Chris Senyek, chief investment strategist, Wolfe Research. “This combined with a highly uncertain tariff path leads us to conclude that the near-term direction of the stock market remains lower.”
The European Union will tighten steel import quotas to reduce inflows by a further 15% from April, a senior EU official said, in a move aimed at preventing cheap steel flooding the European market after Washington imposed new tariffs. Boeing shares jumped 5.9% after the aircraft maker said it doesn’t see a near-term impact from tariffs.
Analysts have said that markets are now awaiting Trump’s announcements regarding reciprocal trade barriers on April 1.
At 11:39 a.m. ET the Dow Jones Industrial Average rose 260.14 points, or 0.63%, to 41,843.97, the S&P 500 gained 40.51 points, or 0.72%, to 5,654.94, and the Nasdaq Composite gained 175.40 points, or 1.01%, to 17,679.52.
Seven of the 11 S&P 500 sectors rose, led by a 1.3% gain in consumer discretionary stocks. Tesla gained 4.7% after the EV maker logged declines over the past two sessions. US stocks have come under severe selling pressure in the recent weeks after a raft of economic indicators signaled a cooling of the economy amid trade policy uncertainties. Multiple companies have also lowered their annual forecasts, the latest being General Mills. The Pillsbury owner lowered its annual sales outlook, sending its shares down 2.3%. The benchmark S&P 500 index confirmed last week it was in correction following a 10% drop from its recent high. The tech-heavy Nasdaq also confirmed a correction on March 6, while the blue-chip Dow is about 2% away from the correction threshold.
Nvidia rose 1.4%. CEO Jensen Huang said on Tuesday the company was well placed to navigate a shift in the artificial intelligence industry. Venture Global rose 3.7% on Wednesday after a report said the Trump administration is set to grant the LNG producer conditional approval to export natural gas from a proposed Louisiana facility. Advancing issues outnumbered decliners for a 1.68-to-1 ratio on the NYSE and a 1.72-to-1 ratio on the Nasdaq. The S&P 500 posted one new 52-week high and no new low, while the Nasdaq Composite recorded 21 new highs and 71 new lows.
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