After initially showing a lack of direction, stocks have moved moderately higher over the course of morning trading on Wednesday. With the upward move, the major averages are extending the notable advance seen over the two previous sessions.
Currently, the major averages are just off their highs of the session. The Dow is up 132.80 points or 0.4 percent at 34,241.44, the Nasdaq is up 55.57 points or 0.5 percent at 11,312.39 and the S&P 500 is up 19.73 points or 0.5 percent at 4,039.38.
The strength that has emerged on Wall Street comes as traders look ahead to the Federal Reserve’s highly anticipated monetary policy announcement this afternoon.
With the Fed widely expected to slow the pace of interest rate increases to 50 basis points, traders are likely to pay close attention to the accompanying statement for clues about the outlook for future rate hikes.
Recent data showing a slowdown in the pace of price growth has led to some optimism the Fed will not raise rates as high as previously feared.
The Fed is not likely to make any firm commitments, however, as a slew of key data will be released before the next monetary policy meeting in late January/early February.
Positive sentiment may have been generated in reaction to a Labor Department report showing import prices declined for the fifth consecutive month in November.
The Labor Department said import prices slid by 0.6 percent in November after falling by a revised 0.4 percent in October.
Economists had expected import prices to decrease by 0.5 percent compared to the 0.2 percent dip originally reported for the previous month.
The annual rate of import prices growth slowed from 4.2 percent in October to 2.7 percent in November, which reflected the slowest year-over-year growth since January 2021.
The advance by the broader markets comes even though most of the major sectors are showing only modest moves on the day.
Software stocks have shown a strong move to the upside, however, with the Dow Jones U.S. Software Index climbing by 1.4 percent.
Pharmaceutical and utilities stocks are also seeing notable strength in morning trading, while steel stocks have moved to the downside.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan’s Nikkei 225 Index advanced by 0.7 percent, while Hong Kong’s Hang Seng Index rose by 0.4 percent.
Meanwhile, the major European markets have moved to the downside on the day. While the German DAX Index has fallen by 0.4 percent, the French CAC 40 Index and the U.K.’s FTSE 100 Index are both down by 0.2 percent.
In the bond market, treasuries have shown a lack of direction over the course of the morning. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 3.496 percent.
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