U.S. stocks closed with a mixed performance on Monday as investors anticipated the Federal Reserve's upcoming monetary policy announcement, maintaining a cautious and selective approach to their investments.
The Dow Jones Industrial Average reached a new record high, climbing 228.30 points or 0.55% to conclude at 41,622.08. Conversely, the Nasdaq Composite declined by 91.85 points or 0.52%, closing at 17,592.13. The S&P 500 saw a modest increase, gaining 7.07 points or 0.13% to settle at 5,633.09.
Market participants widely expect the Federal Reserve to announce an interest rate cut; however, the extent of the cut remains under discussion. CME Group's FedWatch Tool indicates a 65% probability of a half-point rate reduction and a 35% chance of a quarter-point cut.
Regardless of whether the cut is 25 or 50 basis points, it is anticipated that the Fed will continue to reduce rates throughout the remainder of the year.
On the corporate front, Oracle Corporation soared over 5%. Other notable gainers included Meta Platforms, Accenture, Cisco Systems, and IBM. Financial heavyweights such as Bank of America, Wells Fargo, Goldman Sachs, JP Morgan Chase, Citigroup, and Morgan Stanley posted robust gains. Visa Inc. and Mastercard also ended the day on strong notes.
Energy giants Exxon Mobil Corporation and Chevron Corporation recorded substantial gains. Consumer staples like Procter & Gamble, Merck, Abbot Laboratories, and Pfizer witnessed sharp upswings. Additionally, T-Mobile, Linde, GE Aerospace, Verizon Communications, Blackstone, AT&T, Nike, and Walt Disney saw notable increases.
Conversely, technology and retail powerhouses including Tesla, Broadcom, Adobe Inc., Amazon, Nvidia Corporation, Apple Inc., and Intuit Inc. faced sharp to moderate losses.
Economically, the Federal Reserve Bank of New York reported regional manufacturing growth for the first time in nearly a year in September. The New York Fed's general business conditions index surged to a positive 11.5 in September from a negative 4.7 in August, surpassing economists' expectations of a slight rise to negative 3.9. This significant increase partly resulted from a turnaround in new orders, with the new orders index spiking to a positive 9.4 in September from a negative 7.9 in August.
Internationally, Asian markets concluded with mixed results amid thin holiday trading, influenced by disappointing Chinese data and cautious sentiment ahead of policy meetings by the Federal Reserve, Bank of Japan (BoJ), and Bank of England (BoE). Both the BoJ and BoE are expected to maintain their current rates.
European markets closed on a weaker note following a cautious session as investors awaited the monetary policy announcements from the BoE, the Federal Reserve, and the BoJ.
