Market Snapshot: S&P 500 futures struggle for momentum ahead of looming Fed decision

U.S. stock futures were a fraction firmer with traders wary ahead of the Federal Reserve rate decision and comments due midweek.How are stock-index futures trading
S&P 500 futures
ES00,
+0.14%
rose 4 points, or 0.1%, to 4505

Dow Jones Industrial Average futures
YM00,
+0.12%
gained 33 points, or 0.1%, to 34968

Nasdaq 100 futures
NQ00,
+0.15%
added 14 points, or 0.1%, to 15428

On Monday, the Dow Jones Industrial Average
DJIA
rose 6 points, or 0.02%, to 34624, the S&P 500
SPX
increased 3 points, or 0.07%, to 4454, and the Nasdaq Composite
COMP
gained 2 points, or 0.01%, to 13710.

What’s driving markets After the S&P 500 started the week with a less-than 0.1% gain, trading was again cautious Tuesday, with investors wary of taking fresh bold positions ahead of the Federal Reserve’s policy decision. The central bank is fully expected by the market to leave interest rates at a range of 5.25% to 5.50% after its meeting on Wednesday, but traders are wary about accompanying guidance on any future hikes amid stubborn inflationary pressures — a concern that sees 10-year benchmark Treasury yields
BX:TMUBMUSD10Y
holding near their highest level since 2007. Recent stronger-than-forecast economic news alongside a 10-month high in oil prices may encourage the Fed to deliver a “hawkish pause”, according to Ipek Ozkardeskaya, senior analyst at Swissquote Bank. The central bank will likely revise its growth expectations significantly higher on the back of resilient consumer spending and solid growth, and therefore “will certainly sound cautious and reasonably hawkish this week,” she said. “The so called dot plot will certainly point at another rate hike before the year end, and a higher median rate throughout next year,” Ozkardeskaya added. U.S. economic updates set for release on Tuesday include housing starts and building permits for August, due at 8:30 a.m. Eastern. “[A] palatable air of uncertainty engulfs global markets. While U.S. stocks and bonds have been treading water, oil prices are on the rise, which complicates the policy decisions of major central banks, including the Federal Reserve, ECB, and Bank of England,” said Stephen Innes, managing partner at SPI Asset Management. The European Central Bank raised rates by 25 basis points last week and the Bank of England is expected to do the same this Thursday.

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