Nasdaq 100 and S&P500: Tech Stocks Support US Indices While Markets Eye Fed Decision

Stocks Steady as Traders Position for Fed Cut and Corporate Deals Drive Early Action

U.S. stocks traded mixed shortly after the open on Monday as investors positioned ahead of Wednesday’s Federal Reserve decision, where traders overwhelmingly expect a 25-basis-point rate cut.

Caution dominated early flows with the Dow and S&P 500 slightly lower and the Nasdaq nearly flat, reflecting the market’s focus on how divided the FOMC could be this week. Updated consumer spending data from late Q3 showed moderate improvement, reinforcing expectations that policymakers will prioritize labor-market support.

A potential three-way split inside the Fed is now a central market theme. Analysts highlighted the possibility of Governor Stephen Miran favoring a 50-bp cut, while at least three officials may prefer no change.

Deutsche Bank noted that four or more dissenting votes would represent the largest disagreement since 1992.

According to CME FedWatch, traders are pricing an 89.6% probability of a 25-bp move, up sharply from November. Chair Powell’s press conference remains the key event for traders seeking clues about future easing.

How Did the Major Indexes Perform Early in the Session

By 15:23 GMT, the Dow fell 0.19%, the S&P 500 slipped 0.016%, and the Nasdaq eased 0.03%. Market breadth showed modest deterioration on the NYSE, while the Nasdaq recorded more advancing names than decliners. New 52-week highs continued to outpace lows, led by strength in several growth names.

Which Sectors Showed Relative Strength

Technology was the sole S&P 500 sector in the green, up 0.48%, supported by a near 3% gain in Broadcom after reports that Microsoft is in talks with the company on custom chip development.

Oracle added 2.4%, while Marvell Technology fell 8.2% after being left out of the latest S&P 500 rebalance.

Most defensive and cyclical groups traded lower, with communication services, utilities, consumer discretionary, and health care lagging.

What Corporate News Is Moving Individual Stocks

Warner Bros Discovery surged 7.2% after Paramount Skydance launched a $108.4 billion hostile bid, aiming to outmaneuver Netflix. Paramount gained 1.6% while Netflix slid 2.8%.

Confluent soared 28.5% after IBM agreed to acquire the company for roughly $11 billion, lifting IBM by 1.6%.

Tesla slipped 1.9% following a Morgan Stanley downgrade, while Carvana jumped 7.2% after securing entry into the S&P 500.

What Should Traders Expect Next

Market focus remains firmly on the Fed. A divided committee could inject temporary volatility into rates and equities, but the strong pricing for a quarter-point cut suggests a modestly bullish near-term bias if the Fed confirms a steady easing path.

Powell’s guidance will be pivotal for determining whether risk appetite improves into month-end.

More Information in our Economic Calendar.