NEW YORK, NY - SEPTEMBER 13: People walk past the New York Stock Exchange (NYSE), September 13, 2016 in New York City. The Dow Jones industrial average fell 258 points on Tuesday. Drew Angerer/Getty Images/AFP == FOR NEWSPAPERS, INTERNET, TELCOS & TELEVISION USE ONLY ==
NEW YORK: Wall Street was higher on Monday, lifted by financial and energy stocks, a day before the Federal Reserve meets to discuss interest rates.
The central bank is expected to leave rates unchanged at the two-day meeting, but investors will assess Fed chair Janet Yellen’s speech on Wednesday for clues on the timing of the next rate hike.
The probability of a December move shot up to 70% in the past month from 57.5% in the previous month, according to a Reuters poll of over 100 economists.
The S&P 500 financial index rose 0.97%, topping 10 of 11 major sectors trading higher. The index lost 1.3% last week, partly due to some Fed officials striking a dovish stance on rates.
“The weakness seen last week (in financials) is attracting attention today,” said Robert Pavlik, chief market strategist at Boston Private Wealth.
JPMorgan, Bank of America and Wells Fargo rose more than 1% and were the top influences on the S&P.
The energy index rose 0.91%, recovering from the six-week low it hit last Wednesday, as oil prices climbed more than 2%.
Investors will also keep an eye on the Bank of Japan’s policy meeting on Tuesday and Wednesday, where it is largely expected to not announce further policy easing.
At 11:00am ET, the Dow Jones industrial average was up 90.53 points, or 0.5%, at 18,214.33, the S&P 500 was up 9.3 points, or 0.43%, at 2,148.46 and the Nasdaq Composite was up 13.61 points, or 0.26%, at 5,258.17.
The dollar index declined 0.38%, sending gold prices higher, on dim prospects of a rate increase this week.
Traders priced in a 12% chance of a rate hike by Wednesday, while the odds jumped to 56% for December, according to the CME Group’s FedWatch tool.
Sarepta Therapeutics’ shares soared 74% after the FDA approved its key muscle disorder drug.
Casino operator Isle of Capri jumped 31% after Eldorado Resorts said it would buy the company for US$1.7bil, including debt.
General Motors rose 3% after Morgan Stanley upgraded the stock to “overweight”.
US electrical components distributor Avnet was up 8.8% after it announced the sale of its IT business to tech products distributor Tech Data Corp for about US$2.6bil. Tech Data’s stock soared 21 %.
Advancing issues outnumbered decliners on the NYSE by 2,427 to 484. On the Nasdaq, 1,938 issues rose and 746 fell.
The S&P 500 index showed nine new 52-week highs and two new lows, while the Nasdaq recorded 84 new highs and 13 new lows. - Reuters
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