Stock Market Today: S&P 500 Rises Ahead of Upcoming Inflation Data

The S&P 500 concluded higher on Wednesday as investors processed insights regarding interest rates from the Federal Reserve, just one day before new inflation data and a highly anticipated Tesla robotaxi event.

By 4:00 p.m. ET (2000 GMT), the Dow Jones Industrial Average was up 431 points, or 1%. The S&P 500 rose by 0.7%, while the NASDAQ Composite increased by 0.5%.

### Fed Minutes Reveal Support for Jumbo Rate Cuts

According to minutes from the Federal Reserve’s recent meeting on September 17-18, a “substantial majority” of policymakers favored a significant rate cut last month. However, some members expressed a preference for a more cautious approach due to concerns about economic strength.

The minutes reflected earlier discussions, and more recent data has indicated stronger economic growth, which has led to diminishing expectations for further large rate cuts. Strong payroll figures released last week raised questions about the urgency for the Fed to maintain aggressive rate reductions. Currently, traders are pricing in an 81.1% probability of a 25 basis point cut in November, with an 18.9% chance that rates will remain steady.

The Fed had previously lowered rates by 50 basis points in September, emphasizing that future cuts would be contingent on inflation trends and labor market conditions.

Investors are looking ahead to the consumer price index for September, set to be released Thursday, which may provide additional insights into the Fed’s monetary policy direction. There are rising concerns that achieving the target inflation rate of 2% could prove more difficult than anticipated, given the robust labor market.

### Alphabet Faces Possible Break-Up; Tesla’s Robotaxi Event Anticipated

Alphabet saw a decline of 2% following reports that the U.S. Department of Justice is considering possible actions against the company, stemming from a significant antitrust case that found it guilty of abusing its dominant market position. The DOJ may pursue “behavioral and structural remedies” to prevent Google from leveraging its products, like its web browser and app store, to bolster its search business unfairly.

Reddit Inc. experienced a slight uptick after Jefferies began covering the stock with a buy rating, anticipating that growth in user numbers could enhance earnings.

Boeing Co. saw its stock fall over 3% amid an ongoing strike involving the International Association of Machinists union, following the company’s withdrawal of its contract offer.

In contrast, Arcadium Lithium’s stock soared by 31% after global mining giant Rio Tinto confirmed its intention to acquire the U.S. company in a $6.7 billion all-cash transaction.

Tesla, on the other hand, experienced a 1% drop as it prepared for its robotaxi event scheduled for Wednesday.