Stock market today: Live updates

The S&P 500 rose slightly on Tuesday as Wall Street looked ahead to this week’s interest rate decision from the Federal Reserve.

The broad market index traded up 0.1%, while the Nasdaq Composite gained 0.2%. The Dow Jones Industrial Average fell 83 points, or 0.2%.

Traders are waiting for the Fed’s highly awaited interest rate decision on Wednesday, which will be the last of the year. Markets are betting that the central bank will lower its key overnight lending rate by another quarter percentage point as it did at its meetings in September and October. Fed funds futures suggest an 87% chance of a decrease, up from under 67% about a month ago, according to CME’s FedWatch tool.

“While a rate cut feels almost certain at this point, the Fed’s economic projections and Chairman Powell’s commentary will play a big role in how markets react — not only this week, but it could possibly set the tone for the remainder of the month,” said Bret Kenwell, U.S. investment analyst at eToro. “After the recent pullback in stocks and crypto, risk-on investors are hoping the Fed will grease the rails for a year-end rally rather than pour cold water on the recent rebound.”

Kenwell noted that the Fed is balancing a confluence of factors heading into its decision: sticky inflation, a cloudy macroeconomic landscape, economic data delayed by the record U.S. government shutdown and expectations of a new chairman.

“There are a lot of moving parts for the Fed in 2026. … That brings up the key question: Will the Fed be able to strike an accommodative tone if these factors persist into 2026, or will its dual mandate keep the doves in check?” he said.

The Russell 2000 small-cap index reached a fresh all-time intraday high during Tuesday’s session, as rate cuts could boost small companies more because their borrowing costs are more linked to market rates than larger ones, and the lower rates could help economic growth broaden out to more industries.

CVS was among the winners of the trading day, rising 2% after the drugstore chain issued a better-than-expected profit outlook for next year.

On Monday, tech stocks were the winner. Out of the 11 S&P 500 sectors, the tech sector was the only one that closed in the green, buoyed by gains in a slew of semiconductor names. Shares of Broadcom rose almost 3%, while Nvidia and Microsoft each added about 2%, on the back of a report from The Information that Microsoft is considering designing custom chips with Broadcom. 

Each of the three major U.S. stock indexes declined in the previous session, meanwhile, while the 10-year Treasury yield continued to climb as worries remain about the impact of persistent inflation.