Markets Hold Steady as Fed Decision Looms, While Small Caps Hit New Highs
MarketDash
U.S. stocks climbed modestly Wednesday as investors awaited the Federal Reserve's anticipated rate decision. Small-cap stocks continued their record-breaking run, while GE Vernova surged on an improved outlook and silver's historic rally rolled on.
Get Market Alerts
Weekly insights + SMS alerts
Wednesday's trading session had that familiar pre-Fed feel: markets drifting cautiously higher while everyone waits to see what the central bank has to say. U.S. stocks edged up ahead of the Federal Open Market Committee's much-anticipated decision, with investors broadly expecting a third consecutive 25-basis-point rate cut.
But the real story isn't just whether the Fed cuts rates today. It's what comes next. The Fed will release updated macro projections, including a new dot plot that reveals where policymakers think rates should go over the next few years. Economists are warning that while a December cut looks like a done deal, officials may signal a more cautious stance heading into 2025, potentially opening the door to a prolonged pause. Translation: enjoy this rate cut while you can, because it might be the last one for a while.
The Dow Jones climbed 250 points, or 0.5%, reaching 47,810. The small-cap Russell 2000 extended its record run with a 0.3% gain to 2,535, continuing to outperform its larger peers. The S&P 500 and Nasdaq 100 were essentially flat as traders held back ahead of the Fed's statement and after-hours earnings reports from Oracle Corp. (ORCL) and Adobe Inc. (ADBE).
GE Vernova Steals the Show
GE Vernova Inc. (GEV) was the day's standout winner, rocketing 14% higher after the company raised its outlook during Tuesday's Investor Day. That's the kind of move that gets everyone's attention, and it helped lift the entire industrials sector.
On the flip side, Uber Technologies Inc. (UBER) had a rough day, sliding more than 5% to become the worst performer in the S&P 500. The stock dropped 3.8% on Tuesday and continued its descent Wednesday as regulatory pressure in Europe intensified and Morgan Stanley cut its price target. Lyft Inc. (LYFT) didn't fare much better, falling 7.13% to lead the Russell 1000's losers for the day.
Silver's Historic Rally Continues
If you thought silver's rally was getting tired, think again. The metal pushed to $61 an ounce Wednesday, extending what's become a blockbuster year. Silver is now up 112% year-to-date, putting it on track for its strongest annual performance since 1979. That's the kind of move that makes gold's gains look almost boring by comparison.
In the crypto markets, Bitcoin (BTC) slipped 0.6% to $92,000, while Ethereum (ETH) rose 1% to $3,350. The modest moves suggest crypto traders are also in wait-and-see mode ahead of the Fed decision.
Wednesday's Performance In Major US Indices, ETFs
Major Indices
Price
% Change
Nasdaq 100
25,613.51
-0.2%
S&P 500
6,846.38
0.1%
Dow Jones
47,785.09
0.5%
Russell 2000
2,533.90
0.3%
Updated by 12:10 p.m. ET
Looking at the major ETFs, the picture becomes clearer:
That sector rotation tells an interesting story. Industrials leading while tech lags? That's not the usual script for 2024, but it makes sense when you consider the Fed decision ahead and the fact that rate-sensitive sectors might benefit more from continued cuts.
All eyes now turn to the Fed's 2 p.m. ET announcement and Chair Jerome Powell's press conference. The rate cut itself is basically priced in, but what Powell says about the path forward could determine whether this market rally continues or takes a breather heading into 2025.
