NEW YORK, Dec 13 — US stocks were mixed in early trading today, as investors prepared for the US Federal Reserve’s interest rate decision later in the day.
The Fed is widely expected to leave interest rates unchanged and signal it expects two rate cuts in 2024 — less than the markets are expecting.
About 15 minutes into trading, the Dow Jones Industrial Average was down 0.1 per cent at 36,544.22.
The broad-based S&P 500 rose 0.1 per cent to 4,648.43, while the tech-rich Nasdaq Composite Index jumped 0.4 per cent to 14,583.68.
“The Federal Reserve is set to hold rates steady for a third consecutive meeting,” B Riley Wealth Management Chief Market Strategist Art Hogan wrote in a note to clients.
Alongside its rate decision, the Fed will also publish its quarterly Summary of Economic Projections, or SEP, which provides a window into how policymakers see the economy unfolding in the coming years.
“We expect that the SEP will offer a more constructive outlook on growth, employment, and inflation,” than its September update, Hogan said.
He added that the Fed was likely to cut its forecast for interest rates at the end of year by 0.25 percentage points.
This will reflect the slightly lower starting point for rates going into 2024 than was predicted in September, and signal to the markets that the Fed hasn’t changed its view about the two rate cuts it expects next year.
“That reduction will move the Fed closer to the recent pricing in financial markets,” he said.
Among individual stocks, Vertex Pharmaceuticals was up 6.5 per cent on news it had struck a licensing deal with Editas Medicine for its gene-editing treatments.
And fellow drug maker Pfizer saw its share price fall 9.3 per cent after warning its revenues could fall next year on a slowdown in demand for Covid-19 products. — AFP
