S&P 500 and Nasdaq edged higher on Wednesday as investors awaited the Federal Reserve’s interest rate decision later in the day, while a decline in crude oil prices offered some relief amid ongoing concerns over inflation and the Middle East conflict.
The Fed is scheduled to announce its rate decision at 2 p.m. ET. The outcome is being closely watched by investors as elevated Treasury yields, persistent inflation and escalating tensions in the Middle East continue to weigh on risk appetite.
Market participants will also closely track comments from Fed Chair Kevin Warsh for indications about the central bank’s assessment of inflation and the potential direction of interest rates.
According to the CME FedWatch Tool, traders were pricing in nearly a 93% probability of a rate increase.
As of 11 a.m. Eastern Time, the S&P 500 rose 0.4%. The Dow Jones Industrial Average was down 0.1% and the Nasdaq Composite was 0.8% higher.
At the open, the Dow Jones Industrial Average rose 22.3 points, or 0.04%, to 52,115.4. The S&P 500 rose 15.5 points, or 0.20%, to 7,601.25, while the Nasdaq Composite rose 126.9 points, or 0.49%, to 26,108.462.
US retail sales rise 1.2% in August
Meanwhile, fresh economic data showed that US retail sales increased 1.2% month-on-month in August to $773.9 billion, exceeding market expectations.
The increase was partly supported by higher gasoline prices during the month.
Oil prices retreat as supply concerns ease
Crude oil prices moved lower after reports that Saudi Arabia was offering additional crude cargoes through Oman.
The development eased some concerns about the extent of potential supply disruptions linked to the escalating Middle East conflict.
Brent crude futures were down 1.1% at $107.55 a barrel, while US West Texas Intermediate crude futures declined 1.9% to $103.82.
The movement in oil prices remains an important factor for markets because a prolonged increase in energy costs could add to inflationary pressures and complicate the Federal Reserve’s policy outlook.
Key Stock Movers
Among individual stocks, Meta shares gained 1.1%, while Microsoft edged lower.
Intel shares jumped 5.6% following a report that South Korea’s SK Hynix was in discussions with the chipmaker about memory-chip manufacturing in the United States.
The reported talks would mark the first such manufacturing discussions between the two companies in the US.
US-listed shares of SK Hynix also moved higher, gaining 2.5% during the session.
Bullion
Gold prices rose on Wednesday as oil prices and US Treasury yields declined.
As of 09:25 a.m. EDT (1325 GMT), spot gold was up 1.4% at $4,353.82 per ounce. US gold futures for December delivery rose 1.4% to $4,395.10.
Spot silver rose 1.4% to $64.55 per ounce, platinum gained 0.7% to $1,788.15, and palladium was up 1.1% at $1,303.5.
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