Overview
Stock are mixed in the run-up to tomorrow’s interest rate decision. Investors anxiously await Janet Yellen’s statement in which the Fed chair may divulge when the bank plan to reduce its trillion-dollar balance sheet.
Equity markets have lost traction after the S&P 500 climbed 0.2% to close at the second all-time high in a row. Investors are hesitant this morning, unwilling to add to their bullish bets before the Fed reveal its plans.
European assets were mostly flat. France’s CAC 40 is up 0.08% while Germany’s DAX 30 is down 0.18%. Thanks to the weaker pound, the FTSE 100 has added 0.25%.
Asian equities dipped downwards, with China A50 closing 0.7 lower and Australia’s SPI 200 giving up 0.16% of its gains.
The Fed are expected to leave interest rates unchanged but tackle the start of the lengthy process of reducing its $4.5tn balance sheet.
Forex
The dollar is 0.1% lower against a basket of major currencies while the euro is 0.3% higher. The pound fell after Mark Carney, Bank of England’s governor, delivered a dovish speech on Monday.
The Japanese yen fell 0.1% against the dollar and 0.37% against the euro. Investors are shying away from risk-haven assets as geopolitical risks step out of focus.
Commodities
Brent oil, the international benchmark, added 0.8% to its value, on top of Monday’s five-month high thanks to tighter supplies from the Middle East. Crude oil followed suit, climbing 0.8%, trading close to $51 at $50.78.
After sliding to a two-week low, gold jumped 0.09% as the weaker dollar provided support for the precious metal.