US stocks majorly jumped on Wednesday, September 16 even as traders wait for the Federal Reserve to announce a possible interest-rate hike amid inflation concerns.
At 9:31 a.m. EDT, Dow Jones Industrial Average remained majorly unchanged at 52,055 points, S&P 500 gained 17 points or 0.23% to 7,603.05, while the Nasdaq Composite climbed over 122 points, or 0.47%, to 26,103.72.
Stocks rebounded from its lowest level since July, with a pause in S&P 500's continued losses. A surge in chip stock also boosted investor sentiment. Treasury 10-year yields fell from a nearly two-decade high, while brent crude fell below $108 a barrel follwoing a 4% jump over the last two sessions.
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Meanwhile, traders expect Fed to increase increase interest rates for the first time since 2023 amid grwoing inflation concerns.
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Markets are estimating a 25-basis-point rate hike on Wednesday with a 92.5% probability, according to the CME FedWatch tool. Investors are also assigning a 45% probability to another quarter-point hike at the Fed's October meeting and a 30% probability of a December hike. The current target rate range stands at 3.5%-3.75%. A hike in interest rate typically adds pressure to the stock market.
In the current scenario, US stocks are possibly in green due to the willingness among investors to buy stocks after recent declines. On Tuesday, stocks were under pressure, with the S&P 500 slipping 0.45% and the technology-heavy Nasdaq Composite dipped 0.78%. The pullback has given investors with a chance to invest at lower levels, especially in areas that have seen strong structural demand.
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