Stocks looked set to climb again as investors waited for Wednesday’s Federal Reserve policy decision, with the central bank all-but certain to cut interest rates for the first time this year.
Futures tracking the Dow Jones Industrial Average were up 8 points, effectively flat. S&P 500 futures climbed 0.1% and contracts tied to the tech-heavy Nasdaq 100 rose 0.2%, after both indexes clinched closing highs the previous session.
Wall Street is convinced the Fed will lower rates tomorrow, with most traders betting on a quarter-point reduction.
The market also got a boost on Monday after President Donald Trump said trade talks in Madrid between the U.S. and China had gone “very well,” as the world’s two largest economies try to thrash out a trade deal.
“Markets have continued to power forward over the last 24 hours, with risk appetite supported by positive noises out of the US-China trade talks,” Deutsche Bank analyst Jim Reid said. “That newsflow led to growing optimism that some kind of longer-term truce would eventually be reached between the two.”
A federal appeals court on Monday night rejected an emergency request from the White House to remove Fed Gov. Lisa Cook ahead of the policy meeting. Trump’s senior economic advisor will also be there, after the Republican-controlled Senate approved Stephen Miran’s confirmation to the Fed board.
The yield on the benchmark 10-year U.S. Treasury note slipped 1 basis point to 4.03% early Tuesday. Gold climbed 0.3% to hit a new high of just under $3,732 an ounce, and the U.S. dollar slid 0.2% against a weighted basket of its peers.
