Stocks Little Changed as Investors Play It Safe Ahead of the Fed
By Marina Force and Michael Wursthorn
U.S. stocks inched higher Tuesday, as investors braced for the Federal Reserve's policy decision this week.
The Dow Jones Industrial Average gained 43 points, or 0.2%, to 22374 in recent trading. The S&P 500 added 0.1%, while the Nasdaq Composite rose 0.2%.
Major U.S. indexes have mostly drifted higher in recent trading sessions, with the S&P 500 and Dow industrials rising to fresh records together Monday.
Some analysts attributed the lull in the stock market to investors holding off on bets ahead of the Fed's upcoming policy announcement. Many expect the central bank to announce Wednesday that it will keep rates unchanged and that it will start slowly unwinding its $4.5 trillion balance sheet.
"It's a really quiet market. People are in a wait-and-see mode ahead of the Fed meeting," said Bret Chesney, a senior portfolio manager at Alpine Global Management. "With the things I'm trading today, just nodding at the stock moves prices."
Still, any messaging from the Fed that departs from investors' expectations could shake up the markets, traders said.
"We could get some volatility tomorrow afternoon if the statement is considerably different from what we're expecting," said Thomas Wright, director of equities at JMP Securities.
The S&P 500 telecommunications sector jumped 2% on Tuesday, among the biggest gainers in the broad index, after CNBC reported that T-Mobile and Sprint were in active talks about a merger. Sprint rose 8%, while T-Mobile gained 4.4%.