Market Snapshot: U.S. stock futures pause at record highs as Fed decision looms

U.S stock futures were perched lower Tuesday as traders took a breather while waiting for the latest Federal Reserve monetary policy decision.

What’s happening
  • Futures on the Dow Jones Industrial Average YM00, +0.04% fell 24 points, or 0.1%, to 35776
  • Futures on the S&P 500 ES00, -0.01% slipped 4 points, or 0.1%, to 4602
  • Futures on the Nasdaq 100 NQ00, -0.18% fell 0.2%, or 34 points, to 15860

On the first day of November, the Dow Jones Industrial Average DJIA, +0.26% rose 94 points, or 0.26%, to 35914, the S&P 500 SPX, +0.18% increased 8 points, or 0.18%, to 4614, and the Nasdaq Composite COMP, +0.63% gained 98 points, or 0.63%, to 15596. All three indexes notched record highs, with the S&P 500 now up 23% in 2021.

What’s driving markets

The Fed is due to start its two-day meeting on Tuesday, with expectations that it will announce on Wednesday it is going to reduce the rate of bond purchases.

“The key question going into this meeting will be to what extent the Fed pushes back against market pricing, which now suggests the Fed will begin raising rates by the middle of 2022,” said Bill Diviney, senior economist at ABN Amro.

“While worsening supply-chain bottlenecks and stubbornly strong goods consumption in the U.S. have raised the risk of more persistent elevated inflation, and uncertainty is high, we continue to think there is a high bar for the Fed to row back on its signalling that the end of asset purchases would not be immediately followed by rate hikes.”

Pfizer PFE, -0.23% and DuPont DD, +2.34% headline Tuesday’s set of earnings releases, with the Wall Street Journal reporting that the chemicals company also will announce a deal to buy electronics materials specialist Rogers.

Tesla TSLA, +8.49% also will be in the spotlight as CEO Elon Musk questioned whether a rally for the electric vehicle maker was driven by an announcement that Hertz would buy 100,000 cars, an order Musk pointed out has not been signed.

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