US stocks mixed before key Fed interest rate decision

By Ovunc Kutlu

ISTANBUL (AA) - US stocks opened mixed on Wednesday before a key decision by the Federal Reserve, with many analysts expecting a pause in the long cycle of interest rate hikes.

The blue-chip Dow Jones was down 116 points, or 0.34%, to 34,095 at 9.57 a.m. EDT.

The S&P 500, on the other hand, rose five points, or 0.12%, to 4,373.

The tech-heavy Nasdaq gained 12 points, or 0.9%, to 13,587.

Annual consumer inflation in the US came in at 4% in May – the smallest 12-month increase since March 2021, and easing significantly from 4.9% in April.

Annual producer inflation dropped to 1.1% in May, also marking a slowdown from April's annual gain of 2.3%. The figure fell 0.3% on monthly basis, posting the third decline in the last four months.

The positive inflation figures provided optimism for investors who hope the Fed will pause interest rate increases at the conclusion of its two-day meeting at 2 p.m. EDT (1800GMT).

The probability of the Fed keeping rates unchanged was at 95.4% about a half-hour after Wall Street’s opening bell, according to the FedWatch Tool provided by the US-based Chicago Mercantile Exchange Group.

The VIX volatility index, also known as the fear index, fell 0.9% to 14.48. The 10-year US Treasury yield, meanwhile, dropped 1.2% to 3.795%.

The dollar index shed 0.5% to 102.81, and the euro rose 0.45% to $1.0842 against the greenback.

Precious metals were in positive territory, with gold adding 0.6% to $1,955 per ounce and silver rising 1.3% to $23.97.

Oil prices were up around 0.7%, with global benchmark Brent crude at $74.81 per barrel and US benchmark West Texas Intermediate at $69.91.