US equity ETFs strengthen as traders wait for the Fed
U.S. markets and exchange-traded funds rallied to near record highs as investors waited for the Federal Reserve meeting later this week.
The Invesco S&P 500 Equal Weight ETF (RSP), which tracks the S&P 500 Equal Weight (EWI) index, rose 0.8% on Monday. Meanwhile, the S&P 500 was up 0.2%, the Dow Jones Industrial Average was 0.3% higher, and the Nasdaq Composite was up 0.6%.
The Nasdaq continued to take the lead as the Dow Jones Industrial Average broke through the 36,000 level for the first time during Monday’s session.
Looking ahead, the Federal Reserve is expected to implement plans on Wednesday to cut its $ 120 billion monthly bond buying program in the era of the coronavirus pandemic that has helped prop up the economy, Reuters reported.
“I think there is some solace in the Fed and this assumption that the Fed will be steadfast in its patiently dovish stance,” Kristina Hooper, chief global markets strategist at the investment management firm, told Reuters. Invesco.
Investors will also be on the lookout for any hints on the evolution of interest rates and the Fed’s outlook on the recent spike in inflation.
“The market has become very concerned that inflation is a much bigger concern than central banks suggested in the middle of the year and that they are entering an anti-inflation zone,” said Seema Shah, chief strategist at Principal Global Investors. the Wall Street newspaper. “We need to be clear about what the Fed intends to do.”
Data updated on Monday revealed that manufacturing activity in the United States fell in October, with all industries posting record lead times for raw materials, reflecting lingering issues with supply chains that may continue. hamper economic activity as the fourth quarter approaches.
More than half of the companies in the S&P 500 released their third quarter results on Friday. Overall third-quarter profits are expected to rise 39.2%, according to data from Refinitiv IBES.
âThere is still a positive sentiment around earnings despite a few high-profile hiccups,â Hooper added.
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