At around 3:40 p.m., the Dow Jones fell by 0.12%, the Nasdaq gained 0.06% and the S&P 500 index fell by 0.03%.
The New York Stock Exchange began trading on Wednesday close to equilibrium, trading within tight margins a few hours before the announcement of the decision by the American central bank (Fed), which remains unusually uncertain.
At around 1:40 p.m. GMT, the Dow Jones fell by 0.12%, the Nasdaq index gained 0.06% and the S&P 500 index lost 0.03%.
“The market is consolidating while waiting for the Fed,” observed Karl Haeling of LBBW.
The Federal Reserve is due to announce its monetary policy decision at 6:00 p.m. GMT, before a press conference by its chairman Jerome Powell.
Jerome Powell has already indicated for several weeks that the institution would probably proceed with a reduction in its key rate. But a few hours before the announcement, Wall Street has still not rallied to a central hypothesis.
“There could be a marked reaction” to the Fed’s communication, warns Karl Haeling, “because the market has a level of uncertainty that we have not seen for a long time.”
In light of recent indicators, most economists are leaning toward a quarter-percentage-point cut, the standard format for rate changes.
The bond market seems to be more aligned with this point of view. After an initial strengthening on Tuesday, the yield on 2-year US government bonds rose again, to 3.62%, against 3.60% the previous day at the close.
But many investors are betting on a half-point, encouraged by the fact that several Fed members have publicly considered the possibility. They gave the scenario a 63% probability.
“If I were voting, I would go for a quarter point,” Haeling says. “It’s easier to justify. You don’t have to worry about the market panicking that a recession is coming.”
While waiting for the outcome of this suspenseful saga, the New York market remained oriented upwards, encouraged by the acceleration of construction starts in the United States in August, the highest since April.
On the stock market, very few stocks stood out, with Wall Street seemingly frozen before the afternoon deadline.
Despite results that exceeded expectations and the confirmation of its forecasts, the food group General Mills fell (-0.71%). Investors noted the drop in turnover and a contraction in margins.
Burdened by a large debt and penalized by eroding sales, the famous Tupperware, whose name has entered common parlance, has filed for bankruptcy. No longer listed since Monday’s close, the stock remained suspended.
Aerospace group Intuitive Machines was launched into orbit (+52.59%) by the announcement of a five-year, $4.8 billion contract with NASA, covering the establishment of infrastructure enabling frequent trips to the Moon.
Earlier this year, the company managed to land its Odysseus module on the moon, the first private probe to land on the Moon.
US Steel advanced (+1.41%) after the US government’s decision on the takeover of the steelmaker by its Japanese competitor Nippon Steel was postponed until after the presidential election.
President Joe Biden and the two leading candidates, Donald Trump and Kamala Harris, have all publicly expressed their hostility to the deal.
