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Stocks Waver As Fed Meeting Gets Underway

U.S. stocks wavered on Tuesday morning as investors await the Federal Reserve’s interest rate decision as its two-day policy meeting continues. The decision, which is due to be announced on Wednesday, is expected to either be a 25 basis point hike or no move at all.

While the Fed was initially expected to impose a larger hike following the 50 basis point hike by the European Central Bank, it is expected to show restraint amid the ongoing banking sector crisis.

Contracts on the S&P 500 remained stagnant during the morning session, while the Dow Jones Industrial Average edged marginally higher. The technology-heavy Nasdaq Composite slid lower by 0.1%.

Regarding bonds, the benchmark 10-year Treasury yield rose by 3.6%, while two-year yields gained 4.2%. Oil prices were also on the rise, with West Texas Intermediate crude up to $70 per barrel.

Banking stocks were down after Treasury Secretary Janet Yellen revealed that while the U.S. banking system is “sound”, extra rescue arrangements may be needed. Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo all traded lower following the announcement.

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