The S&P 500 edged higher on Tuesday, reaching a new record as the Federal Reserve’s two-day policy meeting began.
The index rose 0.1% to an intraday high of 6,624.13, while the Nasdaq Composite advanced 0.2%. The Dow Jones Industrial Average was little changed.
Oracle shares gained 4% after CBS News reported that the company is part of a consortium expected to play a role in keeping TikTok operational in the US.
The S&P 500 had closed above 6,600 for the first time on Monday, supported by optimism over US-China trade discussions.
US Treasury Secretary Scott Bessent said Tuesday he is optimistic that a trade agreement with China could be reached soon.
Speaking in a CNBC interview, Bessent noted that additional discussions are expected before reciprocal tariffs take effect in November.
The US trade deficit with China, which totalled nearly $300 billion in 2024, has narrowed this year.
Through July, the deficit stood at $128 billion, putting it on track for a decline in 2025.
Large technology stocks added momentum, with Alphabet and Tesla climbing more than 4% and 3%, respectively.
Attention now turns to the Federal Reserve. Market participants see a full likelihood of at least a quarter-point rate cut, according to CME’s FedWatch tool, though investors are awaiting Chair Jerome Powell’s press conference for guidance on the policy outlook.
The meeting follows the Senate’s confirmation of Stephen Miran, President Donald Trump’s nominee to the Federal Reserve Board of Governors.
All eyes on the Fed meet
Federal Reserve Governor Lisa Cook will participate in this week’s policy meeting after an appeals court blocked an attempt by President Donald Trump to remove her from the board ahead of the September gathering, which begins today.
Cook will retain her voting rights on interest rate decisions.
Also joining the meeting is newly confirmed Governor Stephen Miran, who was approved by the Senate on Monday to fill the seat left vacant by Adriana Kugler last month.
Miran, who serves as chair of the White House’s Council of Economic Advisors, said he will take an unpaid leave from that role while serving at the central bank.
Expectations for interest rate cuts in the United States have strengthened following recent economic data.
Markets are now pricing in a cumulative reduction of 0.75 percentage points by the end of 2025 and 1.5 percentage points by September 2026.
However, the Fed has signalled caution, citing inflation that remains near 3%, above its 2% target.
Momentum for cuts accelerated after the release of August non-farm payrolls data.
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