Off The Wire
S&P 500 ends higher on growing hopes Fed will stay accommodative
(Reuters) - The S&P 500 ended up slightly on Tuesday as investors hoped the Federal Reserve would stick with its supportive policy stance as the central bank’s two-day meeting got under way.
Apple Inc shares AAPL.O rose on Monday and early in Tuesday's session, giving the indexes a boost. But Apple turned slightly lower in the wake of its product event, which included the rollout of a new virtual fitness service and a bundle of all its subscriptions, Apple One. The stock often dips after running up prior to that event.
The Nasdaq also rose and outperformed the other two major indexes, while the S&P 500 index .SPLRCT gained, extending its recovery from a brutal sell-off earlier this month that had halted a Wall Street rally.
In its first policy meeting since Fed Chair Jerome Powell announced a more accommodative stance on inflation, the central bank could switch its Treasury purchases toward more long-dated debt to keep long-term yields low, some strategists said.
“While the economy is slowing, the upcoming macro news should be friendly, which should indicate the Fed will have no change in terms of policy,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
Data on Tuesday showed U.S. factory output increased strongly in August. Separately, U.S. import prices increased more than expected for the same month, supporting the view that inflation pressures were building up.
Unofficially, the Dow Jones Industrial Average .DJI rose 1.42 points, or 0.01%, to 27,994.75, the S&P 500 .SPX gained 17.58 points, or 0.52%, to 3,401.12 and the Nasdaq Composite .IXIC added 133.67 points, or 1.21%, to 11,190.32.
The S&P 500 financial index .SPSY fell, with Citigroup Inc C.N dropping following a report that federal regulators were preparing to reprimand the U.S. lender for failing to improve its risk-management systems.
JPMorgan Chase & Co JPM.N also slipped as it lowered its full-year net interest income forecast.
Additional reporting by Medha Singh and Devik Jain in Bengaluru; Editing by Shounak Dasgupta and David Gregorio