- US stocks hovered near record high Tuesday as investors await comments from the Federal Reserve.
- The FOMC decision is due Wednesday after a two-day policy meeting, with most economists anticipating the central bank will leave its policy mostly unchanged.
- Bitcoin rose past $40,000 after Elon Musk tweeted about Tesla and payments.
- Sign up here for our daily newsletter, 10 Things Before the Opening Bell.
US stocks hovered near record highs Tuesday as investors await comments from the Federal Open Market Committee about a timetable for scaling back on its accommodative policies.
The FOMC decision is due Wednesday after a two-day meeting, with most economists anticipating the central bank will leave its policy mostly unchanged. Investors will be focusing on tapering discussions, the latest economic projections, and inflation.
“It is going to be increasingly difficult for the Fed to soothe markets with its dovish stance, as they probably will be discussing tapering and will have to revise up forecasts for economic growth and inflation,” Bank of America said in a note on Tuesday.
While the central bank can exhibit patience this time, the situation will not be the same by the July and September FOMC meetings, Bank of America added.
In March, Fed officials saw consumer prices rising 2.4% in the fourth quarter of 2021 from a year earlier. That pace, they said, would be consistent with their goal of 2% average annual inflation over the long run.
The S&P 500 closed at a record high on Monday for the second trading day in a row. The tech-heavy Nasdaq also closed at a record.
Here’s where US indexes stood at the 9:30 a.m. ET open on Tuesday.
- S&P 500: 4,251.40, down 0.09%
- Dow Jones industrial average: 34,391.85, down 0.01% (1.90 points)
- Nasdaq composite: 14,134.98, down 0.28%
Meanwhile, US retail sales fell 1.3% in May, the Census Bureau said Tuesday. Economists surveyed by Bloomberg held a median estimate for a 0.7% decline. The decline places monthly sales at $620 billion and just below the record-high seen in April. The April sales data was revised higher to a 0.9% jump from an initially unchanged reading.
Bitcoin finally hit the $40,000-level on Monday after trending below that level to date in June. Still, many, including investment adviser Rich Bernstein, believe that bitcoin is in a bubble, and the crypto mania is making investors ignore other asset classes that have more potential.
Bitcoin bull Michael Saylor’s MicroStrategy for its part plans to sell as much as $1 billion in common shares with an eye to adding to its huge holding in the cryptocurrency, it said in a filing with the Securities and Exchange Commission.
Gold slid 0.12% to $1,865.09 per ounce.