Stock market today: Wall Street drifts as bitcoin jumps to another record
AP Business Writer
NEW YORK (AP) — U.S. stock indexes are drifting Monday ahead of a meeting by the Federal Reserve later this week that could set Wall Street’s direction into next year.
The S&P 500 rose 0.2% in early trading, coming off its first losing week in the last four. The Dow Jones Industrial Average was edging up by 17 points, or less than 0.1%, as of 9:35 a.m. Eastern time, while the Nasdaq composite rose 0.4%.
MicroStrategy climbed 2% in its first trading since learning it will soon join the Nasdaq 100 index, as it continues to benefit from the surging price for bitcoin, which set another record. The software company has been building its hoard of the cryptocurrency, and its stock price has more than sextupled this year.
Bitcoin topped $106,000 before pulling back toward $104,500, according to CoinDesk. It’s catapulted from roughly $44,000 at the start of the year, riding a recent wave of enthusiasm that President-elect Donald Trump will create a system that’s more favorable to digital currencies.
The market’s main event, though, will arrive on Wednesday when the Federal Reserve will announce its last move on interest rates for the year. The widespread expectation is that it will cut its main rate for a third straight time, as it tries to give a boost to the slowing job market after getting inflation nearly all the way down to its target of 2%.
The outstanding question is how much more it will cut rates next year, and Fed officials will be releasing projections for where they see the federal funds rate ending 2025, along with other economic indicators, once their meeting concludes. Fed Chair Jerome Powell will also answer questions in a press conference following the meeting.
For now, the general expectation among traders is that the Fed will cut another two times in 2025, according to data from CME Group. But that number has been shrinking following some reports suggesting inflation may be tougher to get all the way down to 2% from here. Besides last month’s slight acceleration in inflation, a worry is that Trump’s preferences for tariffs and other policies could lead to higher inflation down the line.
Expectations for a series of cuts to rates by the Fed have been one of the main reasons the S&P 500 has set an all-time high 57 times so far this year and is heading for one of its best years of the millennium. The economy has held up better than many feared, continuing to grow even after the Fed hiked the fed funds rate to a two-decade high in hopes of grinding down on inflation, which topped 9% two summers ago.
In the bond market, Treasury yields eased a bit. The yield on the 10-year Treasury fell to 4.37% from 4.40% late Friday. The two-year yield, which more closely tracks expectations for the Fed, slipped to 4.22% from 4.25%.
In stock markets abroad, indexes fell modestly across much of Europe and Asia.
They sank 0.9% in Hong Kong and 0.2% in Shanghai after China reported lackluster economic indicators for November despite attempts to strengthen the world’s second-largest economy. .
South Korea’s Kospi fell 0.2% as law enforcement authorities pushed to summon impeached President Yoon Suk Yeol for questioning over his short-lived martial law decree and the Constitutional Court met to discuss whether to remove him from office or reinstate him.
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AP Business Writer Elaine Kurtenbach contributed.
