You are here
US: Financials boost Wall St ahead of Fed meet
[NEW YORK] Wall Street was trading higher on Tuesday, helped by financial stocks, as investors await the Federal Reserve's decision on interest rates.
The central bank's two-day meeting will conclude with Fed Chair Janet Yellen's press conference at 2:00 pm ET on Wednesday.
The doves in the Fed are most likely to rule over the hawks who support higher rates in the near term, but investors will assess the comments for clues on a likely hike in December.
Investors are also watching the Bank of Japan's meeting which starts on Tuesday. Investors have little clue of what path the central bank could take to achieve its 2 per cent inflation target.
The markets have oscillated since Sept 9 as investors second-guess the Fed's intention following a series of contradicting comments on the timing of the next hike from its officials.
Traders have priced in a 15 per cent chance of a rate hike by Wednesday, according to the CME Group's FedWatch tool.
At 9:42 am ET (1342 GMT), the Dow Jones Industrial Average was up 72.32 points, or 0.4 per cent, at 18,192.49.
The S&P 500 was up 7.42 points, or 0.35 per cent, at 2,146.54.
The Nasdaq Composite was up 17.47 points, or 0.33 per cent, at 5,252.49.
The financial sector climbed 0.82 per cent and outperformed the other 10 major S&P 500 indexes.
Wells Fargo rose 2.15 per cent and was the top influence on the S&P after Morgan Stanley upgraded the bank's stock to "overweight".
"Investors are holding vigil before the Bank of Japan and the Federal Reserve's announcements tomorrow and I think everything stays quiet until then," said Peter Cardillo, chief market economist at First Standard Financial in New York.
Shares of Tobira Therapeutics rose more than seven times to $35.86 after Allergan agreed to buy the company in a US$1.7 billion deal. Allergan's stock was down 1.81 per cent.
DTS soared 22.8 per cent at US$42.16 after Tessera Tech agreed to buy the audio equipment maker for US$850 million in cash. Tessera's stock was up 2.7 per cent.
Advancing issues outnumbered decliners on the NYSE by 1,733 to 958. On the Nasdaq, 1,466 issues rose and 813 fell.
The S&P 500 index showed two new 52-week highs and one new low, while the Nasdaq recorded 35 new highs and nine new lows.