As investors anticipate the Federal Reserve’s upcoming policy decision, U.S. stock futures eked out a small gain on Monday morning.
The Dow Jones Industrial Average futures rose 12 points, or 0.03%. The futures for the Nasdaq 100 and S&P 500 both increased by 0.09% and 0.16%, respectively.
The prior trading week saw losses for the broad market index and the Nasdaq, marking the second consecutive week of losses. The Dow was able to complete the week with a 0.1% gain.
Investors often assume that the Fed will maintain stable interest rates. But traders will be watching closely to gain a better idea of the central bank’s position on inflation moving forward.
Whether the Fed presents the pause with a dovish or hawkish slant is what matters most for financial markets, according to Quincy Krosby, chief global strategist for LPL Financial. “How the Fed communicates the pause is key for November and December rate expectations,” he added.
The CME Group’s FedWatch tool, which tracks pricing in the fed funds futures market, shows that traders are giving the Fed a 99% chance of keeping interest rates unchanged when it announces its decision on Wednesday and just a 31% chance of raising them in November.
Source (CNBC)
