Traders Hold Off Large Wagers Before Fed – US Market Wrap
Stocks were mostly flat as Wall Street traders avoided major moves with less than 24 hours remaining before the Federal Reserve delivers its final interest-rate decision of 2025.
The S&P 500 ended little changed after a warning from JPMorgan on higher than expected costs and a description of consumers as “fragile.” The bank dropped more than 4% The Dow slipped while the Nasdaq 100 posted a modest gain. The yield on 10-year Treasuries hovered near 4.18% following a government bond auction. The dollar held steady and Bitcoin reversed early losses.
Kevin Hassett, the frontrunner in Trump’s search for a successor to Powell at the Federal Reserve, said at an event Tuesday that he sees ample room to lower rates substantially, even more than a quarter-point move.
Money markets are pricing about two cuts in 2026 after a likely quarter-point reduction on Wednesday. That marks a pullback from more optimistic expectations seen in recent weeks. Some market watchers are concerned about the risk of a hawkish cut, in which the Fed lowers rates but signals that additional reductions are unlikely for now.
The Treasury Department’s monthly sale of 10-year notes drew a yield of 4.175%, matching the level indicated by trading just before the deadline, when the yield was about a basis point higher on the day.
A multiday decline in US government bonds has softened risk appetite as traders turn cautious about the pace of monetary easing after Wednesday’s decision. For now, the Fed’s rate move and its guidance for 2026 remain central to market direction.
