YUMC - Stocks Edge Higher Ahead Of Federal Reserve Decision Bonds Surge After Softer Treasury Refunding Plan: What's Driving Markets Wednesday? | Benzinga
Stocks experienced a modest surge amid the Federal Open Market Committee meeting Wednesday. The central bank is widely expected to leave interest rates unchanged.
Investors appear to be betting on a dovish press conference from Jerome Powell, as they have largely been buying Treasury bonds in anticipation of no further rate increases and lower refunding needs for the Treasury.
The policy-sensitive two-year Treasury yield fell by 7 basis points to 5.02%, while the 30-year yield declined by 11 basis points. The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) rallied by 1.2%.
In its upcoming quarterly refunding auctions next week, the U.S. Treasury seeks to offer $112 billion in longer-term securities, representing a more restrained pace compared to earlier projections.
The day also witnessed softer-than-expected economic data, with the ISM Manufacturing Purchasing Managers’ Index dropping to 46.7 in October from the previous month’s 49, falling below the anticipated level of 49.
Additionally, the ADP reported the monthly national employment change was 113,000, which was lower than the expected figure of 150,000. Surprisingly, job openings increased for the second consecutive month in September, highlighting the enduring robustness of labor market.
Cues From Wednesday's Trading
The S&P 500 edged 0.3% higher, while tech stocks in the Nasdaq 100 rose 0.6%. The Dow Jones Industrial Average held steady for the day, while small caps eased 0.5%.
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