US Stock Market Opens Higher While Awaiting Fed's Interest Rate and Economic Outlook

Markets Watch Fed's US Economic Outlook Amid Expected Rate Hold

Nvidia and Tesla Rebound

U.S. stock markets opened higher on the 19th (local time) as investors await the Federal Reserve's interest rate and economic outlook announcement.

As of 10 a.m. Eastern Time, the S&P 500 rose 0.6%, while the tech-heavy Nasdaq index climbed 0.9%. The Dow Jones Industrial Average increased by 0.5%.

Nvidia, which fell the previous day despite the GTC event, was trading at $117 in early trading, up 1.5%. Tesla, which had declined for consecutive sessions, rebounded by 2% to trade at $229. Boeing jumped 5% after announcing that cash burn would ease this quarter and factory operations were normalizing.

The 10-year Treasury yield rose 1 basis point (1bp=0.01%) to 4.30%. The Bloomberg Dollar Spot Index strengthened 0.3% against major currencies. The yen weakened after the Bank of Japan decided not to raise interest rates today.

Spot gold was trading at $3,042 per troy ounce, similar to the previous day. Bitcoin rose 2.2% to reach $83,872.35.

The Federal Reserve will announce its policy decision at 2 p.m. Eastern Time (3 a.m. Korean time on the 20th), followed by Chair Jerome Powell's press conference at 2:30 p.m.

The Fed is widely expected to maintain its benchmark interest rate this month. Amid uncertainties about Trump administration policies and recession concerns, markets are focusing on the Fed's updated rate projections and outlook for inflation, unemployment, and economic growth.

Scott Helfstein, Chief Investment Strategist at Global X, who interviewed with CNBC, said, "Chair Powell has repeatedly mentioned that risks to price stability and full employment are balanced." He noted, "While that's likely still true, risks to both inflation and employment are increasing."

According to Bloomberg, options markets anticipate a 1.2% move in either direction ahead of the Fed's policy announcement today. Data collected by Citigroup shows that the average movement on Fed rate policy announcement days over the past year was 0.8%.

Fed Chair Jerome Powell is likely to emphasize that monetary policy is well-positioned. Economists expect the Fed to continue signaling two rate cuts this year in its dot plot.

Kim Jung-a, Contributing Writer kja@hankyung.com