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S&P 500 and Nasdaq are rising as investors begin the countdown to the Fed’s decision

US stocks traded higher on Monday after bitcoin (BTC-USD) rose to a new record, as investors prepared for the Federal Reserve’s final policy decision of the year later in the week.

The Nasdaq Composite (^IXIC) rose about 0.5%. The S&P 500 (^GSPC) gained 0.3%, while the Dow Jones Industrial Average (^DJI) flatlined after a losing week for these key indicators.

Meanwhile, shares of software company MicroStrategy (MSTR) rose more than 4% on news that the bitcoin buyer is joining the Nasdaq 100 (^NDX). Bitcoin itself rose to an all-time high above $106,000 as hopes for a crypto-friendly Trump administration continued to fly high, before falling back to around $104,000.

Markets are moving away from gas as the Federal Reserve’s final meeting of the year approaches. Wednesday’s interest rate decision is already in the spotlight as Wall Street looks for a catalyst that will revive this year’s stellar stock market rally.

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Investors see a final rate cut in 2024 as a certainty, with 97% of traders currently pricing in a 25 basis point move. The bigger question now is whether the Fed is willing to scale back its dot plot, which has planned four more small cuts in 2025, given continued stubborn inflation and potential challenges from the Trump administration.

This week also brings an update to the Personal Consumption Expenditures (PCE) index – the Fed’s preferred inflation gauge – and a November US retail sales figure for insight into consumer resilience.

The Fed’s decision caps a busy week of rate hikes by central banks worldwide, including the Bank of Japan making policy announcements.

Elsewhere, the latest Chinese retail sales figures fell short of expectations, putting pressure on oil prices. Brent (BZ=F) fell slightly to almost $74 a barrel, after rising almost 5% last week, while West Texas Intermediate (CL=F) fell below $71.

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On the corporate front, shares of Super Micro Computer Inc. fell. (SMCI) down 4%, recovering from deeper pre-market losses. The struggling server maker will be delisted from the Nasdaq 100.

LIVE 2 updates

  • Stocks move higher with focus on Fed, while Bitcoin hovers around $104,000

    Stocks edged higher on Monday as investors shifted their focus to the Federal Reserve’s final interest rate policy meeting of the year this week, and bitcoin (BTC-USD) hovered near $104,000 per token after surging to a new record high.

    The Nasdaq Composite (^IXIC) rose more than 0.4%, while the S&P 500 (^GSPC) rose 0.3%. The Dow Jones Industrial Average (^DJI) gained slightly after the longest losing streak for the blue chip index.

    Much of the market action took place in the crypto space. Shares of Bitcoin proxy MicroStrategy (MSTR) rose more than 4% following news of the software company’s inclusion in the Nasdaq 100.

    Bitcoin itself rose to an all-time high above $106,000 on Sunday before falling to $104,000 at last check.

    Investors are broadly expecting a rate cut announcement Wednesday after the Federal Reserve Open Market Committee meeting, but the trajectory of future rate cuts appears less clear following recent higher-than-expected inflation data.

  • Jenny McCall

    Good morning. This is what’s happening today.

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