Stocks have run to records on expectations that the Federal Reserve on Wednesday will announce its first cut to interest rates of the year.
U.S. stocks are hanging around their record heights on Tuesday as the countdown ticks toward what Wall Street expects will be the first cut of the year to interest rates by the Federal Reserve.
The S&P 500 edged down by 0.1%, coming off its latest all-time high. The Dow Jones Industrial Average was down 131 points, or 0.3%, as of 10:15 a.m. Eastern time, and the Nasdaq composite was virtually unchanged.
Stocks have run to records on expectations that the Fed will announce the first of a series of cuts to rates on Wednesday afternoon in hopes of giving the economy a boost. The job market has slowed so much that traders believe Fed officials now see it as the bigger danger for the economy than the threat of higher inflation because of President Donald Trump’s tariffs.
The Fed has been holding off on cuts to rates because inflation has remained above its 2% target, and easier interest rates could give it more fuel.
A report on Tuesday said shoppers increased their spending at U.S. retailers by more last month than economists expected. A chunk of that could simply be due to shoppers having to pay higher prices for the same amount of stuff. But it could also indicate solid spending by U.S. households could continue to keep the economy out of a recession.
