Stocks tick higher ahead of Fed meeting on rates
NEW YORK -- U.S. stocks ticked higher Monday in a week with several reports on inflation scheduled, as well as the Federal Reserve's latest meeting on interest rates. The US stocks have risen ahead of several reports on inflation and the Federal Reserve's latest meeting on interest rates. The S&P 500 rose by 0.3% and the Nasdaq composite also set a record after rising 59.40% to 17,192.53, while the Dow Jones Industrial Average gained 69.05, or 0.2%, to 38,868.04. Shares of Diamond Offshore Drilling rose 10.9% after Noble agreed to buy its rival in a cash-and-stock deal worth $1.6 billion. Meanwhile, shares of Southwest Airlines rose by 7% after Elliott Investment Management announced it's taking a $1,9 billion ownership stake in the company and is seeking new leadership to modernize its software, strategy and operations. The price of crude oil recovered some of its sharp losses since the spring. Despite concerns about high interest rates and the slowdown in the U.S. economy due to mixed data on the economy, traders hope these data will help reduce inflation. The Federal Reserve is expected to announce its latest decision on interest rate on Wednesday, largely no one expects it to move its main interest rate.
Published : 10 months ago by in Politics Finance
NEW YORK -- U.S. stocks ticked higher Monday in a week with several reports on inflation scheduled, as well as the Federal Reserve's latest meeting on interest rates.
The S&P 500 rose 13.80 points, or 0.3%, to 5,360.79 and topped its all-time high set last week. The Nasdaq composite also set a record after rising 59.40, or 0.3%, to 17,192.53, while the Dow Jones Industrial Average gained 69.05, or 0.2%, to 38,868.04.
Southwest Airlines shares flew to one of the market's biggest gains, up 7%, after Elliott Investment Management said it's taken a $1.9 billion ownership stake in the company and is pushing for new leadership to modernize the carrier's software, strategy and operations.
Shares of Diamond Offshore Drilling jumped 10.9% after Noble agreed to buy its rival in a cash-and-stock deal valued at roughly $1.6 billion. Noble added 6.1% in a signal that traders expect the combination to be a winner. Other energy producers also climbed as the price of crude oil recovered some of its sharp losses since the spring.
Huntington Bancshares dropped 6.1% for one of the market's largest losses after cutting its forecast for a key component of profit this year.
Apple shares fell 1.9% after a highly anticipated conference where it showed how its operating systems will use ChatGPT to offer services using artificial-intelligence technology. A frenzy over AI has helped send AI-related stocks to records despite worries about high interest rates and the slowdown in the U.S. economy that they induce.
Data on the economy have come in mixed recently, and traders are hoping they will ultimately show a slowdown that stops short of a recession and is just right in magnitude. A cooldown would put less upward pressure on inflation, which could encourage the Federal Reserve to cut its main interest rate from its most punishing level in more than two decades.
Companies benefiting from the AI boom are continuing to report big growth almost regardless of what the economy and interest rates are doing.
Nvidia, for example, is worth roughly $3 trillion and the shares rose 0.7% Monday after reversing an early-morning loss. It was the first day of trading for the company since a 10-for-one stock split made its share price more affordable to investors, after it ballooned to more than $1,000 a share.
Treasury yields were mixed in the bond market ahead of reports later in the week that will show whether inflation improved last month at both the consumer and wholesale levels.
On Wednesday, the Federal Reserve will announce its latest decision on interest rates. Virtually no one expects it to move its main interest rate then. But policy makers will be publishing their latest forecasts for where they see interest rates and the economy heading in the future.
The last time Fed officials released such projections, in March, they indicated the typical member foresaw roughly three cuts to interest rates in 2024. That projection will almost certainly fall this time around. Traders on Wall Street are largely betting on just one or two cuts to rates in 2024, according to data from CME Group.
In the bond market, the yield on the 10-year Treasury rose to 4.46% from 4.43% late Friday. The two-year yield, which more closely tracks expectations for the Fed, slipped to 4.88% from 4.89%.
Information for this article was contributed by Matt Ott and Zimo Zhong of The Associated Press.
Topics: Markets, DNC