The S&P 500 inched higher overnight as investors awaited the Federal Reserve’s highly anticipated policy meeting, where central bankers are expected to lower interest rates for the first time since 2020. Meanwhile, the Dow Jones Industrial Average climbed to a new all-time high.
The S&P 500 gained 0.13 per cent, closing at 5,633.09. The 30-stock Dow increased by 228.30 points, or 0.55 per cent, finishing at a record high of 41,622.08. In contrast, the tech-heavy Nasdaq Composite fell 0.52 per cent to 17,592.13.
Overnight, the Financial and Energy sectors outperformed the broader market, each adding more than 1 per cent. However, the Information Technology sector posted the largest loss of the day, slipping nearly 1 per cent.
Apple shares dropped 2.8 per cent after analysts from firms such as Bank of America and JPMorgan suggested that shipping times may indicate weaker demand for the iPhone 16 Pro models compared to the previous year.
Chip stocks, including Nvidia, which drove last week's market rally, declined as investors reduced their positions. Nvidia dropped nearly 2 per cent overnight, while Broadcom and KLA Corporation each slid 2 per cent, and Marvell Technology fell 1.5 per cent.
In other company news, Nuvalent shares surged over 28.3 per cent to a record high after reporting positive data on two experimental cancer drugs with "favourable tolerability,” whilst Alcoa rose over 5 per cent after agreeing to sell its 25.1 per cent stake in the Ma'aden joint venture for $1.1 billion.
The Fed is scheduled to meet on Tuesday and Wednesday, with widespread expectations of a rate cut — the first since it began its tightening cycle in March 2022. This anticipated move could reduce borrowing costs for businesses, potentially boosting earnings growth.
The overnight lending rate currently ranges from 5.25 per cent to 5.5 per cent, and according to CME Group's FedWatch Tool, there is a 63 per cent chance the Fed will cut rates by 50 basis points.
Futures
The SPI futures are pointing to a 0.7 per cent gain.
Currency
One Australian dollar at 7.20am was buying 67.52 US cents.
Commodities
Gold lost 0.07 per cent. Silver added 0.20 per cent. Copper gained 0.89 per cent. Oil rose 2.10 per cent.
Figures around the globe
European markets closed mixed. London’s FTSE added 0.06 per cent, Frankfurt lost 0.35 per cent, and Paris closed 0.21 per cent lower.
Turning to Asian markets, Tokyo’s Nikkei was closed, Hong Kong’s Hang Seng added 0.31 per cent, while China’s Shanghai Composite was closed.
Yesterday, the Australian share market closed 0.27 per cent higher at 8122.
Ex-dividends
Base Res Limited (ASX:BSE) is paying 6.5 cents unfranked
Cochlear Limited (ASX:COH) is paying 210 cents 80 per cent franked
Duratec (ASX:DUR is paying 2.5 cents fully franked
Maas Group Holdings (ASX:MGH) is paying 3.5 cents fully franked
Wotso Property (ASX:WOT) is paying 1 cent unfranked
Dividends payable
Dalrymple Bay Infrastructure Ltd (ASX:DBI)
Objective Corp Ltd (ASX:OCL)
Whitehaven Coal Ltd (ASX:WHC)
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap, Marketech.
