Equities, Commodities, Macro Trends, and Investor Sentiment Ahead of the Fed Decision

Index Update:  Premarket trading saw strong gains in several stocks, led by Micron rising 5% on expansion plans, RTX up over 3% on robust revenue, GM climbing 4.5% after lifting guidance, and UPS adding 3.7% on an earnings beat. In contrast, UnitedHealth plunged nearly 17% after warning of a rare revenue decline, dragging healthcare stocks lower, with CVS Health and Humana also falling sharply on concerns over flat Medicare payments.

Market Movers:  On Monday, the top gainers were Brand Engagement Network Inc. (+276.70%), followed by Battalion Oil Corporation (+211.72%). On the contrary, Dogness (International) Corporation. (-76.21%), and Happy City Holdings Limited. (-55.01%) declined the most the same day.

Commodities Update:  Oil prices declined on Tuesday, with WTI near $60.3 per barrel and Brent around $65.2, pressured by the resumption of Kazakh crude exports and the return of full operations at the CPC terminal. Losses were partly offset by U.S. supply disruptions from a winter storm and ongoing geopolitical tensions in the Middle East and Eastern Europe. Markets are now focused on the upcoming OPEC+ meeting, where output levels are expected to remain unchanged. Precious metals rallied sharply on Tuesday, with gold rising over 1% to around $5,080 per ounce after hitting a record high, and silver surging more than 6% above $110, driven by strong safe-haven demand amid escalating trade tensions, geopolitical risks, and concerns over currencies and bonds. Investors are closely watching the Federal Reserve’s policy meeting and comments from Chair Jerome Powell, while fiscal worries and robust central bank and ETF buying continue to support bullion. In contrast, copper prices fell about 2% to $5.9 per pound as rising inventories in China, the U.S., and London signaled weakening demand, despite ongoing support from a weaker dollar and long-term optimism tied to renewable energy and AI-driven industrial use.

Macro Updates:  The dollar index slid for a fourth straight session to around 97, its weakest level since mid-September, as investors awaited the Federal Reserve’s policy decision and weighed concerns over the central bank’s independence. Pressure also came from speculation of a more dovish Fed chair appointment, renewed risks of a U.S. government shutdown, and a broader “sell America” trade, alongside talk of possible U.S.-Japan currency intervention to support the yen.

Bonds Commentary:  The U.S. 10-year Treasury yield ticked up to about 4.23% as markets braced for the Federal Reserve’s policy decision, with rates expected to stay unchanged. Sentiment was shaped by concerns over the Fed’s independence, speculation about a potential new Fed chair, renewed government shutdown risks, and broader geopolitical and trade tensions supporting the ongoing “sell America” trade.

Futures Update:  U.S. equity futures traded marginally lower on Monday as markets adopted a cautious tone ahead of a packed week featuring a Federal Reserve rate announcement and a wave of corporate earnings reports. Dow futures were flat, while S&P 500 futures slipped about 4 points (0.1%) and Nasdaq 100 futures declined roughly 30 points (0.1%).

Following the mixed performance seen during last Friday's session, stocks generally moved higher on Monday, although the upward momentum was somewhat offset by a notable sell-off on Tuesday. The major averages dipped slightly toward the close but ultimately remained in positive territory. The S&P 500 gained 34.60 points, or 0.50%, finishing at 6,950.22. From a technical standpoint, the index found support at key levels and continued to trend higher in the near-term session. The 14-day Relative Strength Index (RSI) remains near the midpoint, reflecting ongoing indecision at current levels. Key support is identified around 6,820—a crucial level that could prompt a rebound—while resistance is anticipated near 6,970.