Wall Street Drifts Ahead of Rate Decision

By STAN CHOE AP Business Writer

NEW YORK (AP) — U.S. stock indexes are drifting higher Wednesday as Wall Street waits for an announcement from the Federal Reserve that could guide its direction into next year.

The S&P 500 rose 0.3% to inch closer to its all-time high set earlier this month. The Dow Jones Industrial Average was up 220 points, or 0.5%, as of 11 a.m. Eastern time, and the Nasdaq composite added 0.3%.

Jabil jumped 8.4% to help lead the market after reporting stronger profit and revenue for the latest quarter than analysts expected. The electronics company also raised its forecast for revenue for its full fiscal year.

Nvidia, the superstar responsible for a chunk of Wall Street’s rally to records in recent years, climbed 4.3% following a weekslong funk. It had dropped more than 12% from its record set last month and fallen in eight of the nine previous days as its big momentum slowed.

On the losing side of Wall Street was General Mills, which dropped 2.8% despite reporting a stronger profit than expected. The maker of Progresso soups and Cheerios said it will increase its investments in brands to help them grow, which pushed it to cut its forecast for profit this fiscal year.

Trading is likely to remain relatively quiet until the afternoon, when the expectation is for the Fed to deliver its third cut to interest rates of the year. After getting inflation nearly all the way down to its 2% target from more than 9%, the Fed has been easing its main interest rate off a two-decade high to offer support for the slowing job market.

The big question is how much more the Fed will cut in 2025, and the hope is that Fed Chair Jerome Powell may give some signals in his press conference following the announcement on interest rates. Fed officials will also unveil projections for where they see interest rates and the economy heading in upcoming years.

Expectations for cuts in 2025 have been diminishing, in part because inflation has recently picked up the pace. Worries are also high that President-elect Donald Trump’s preference for tariffs and other policies could further spur inflation, along with economic growth.

Treasury yields were holding relatively steady as the bond market waited for more clues on where rates are heading.

The yield on the 10-year Treasury slipped to 4.39% from 4.40% late Tuesday. The two-year yield, which more closely tracks expectations for Fed action, eased to 4.22% from 4.25%.

In stock markets abroad, London’s FTSE 100 edged up by less than 0.1% after data showed inflation accelerated to 2.6% in November, its highest level in eight month. The Bank of England is also meeting on interest rates this week and will announce its decision on Thursday.

In Japan, where the Bank of Japan will wrap up its own policy meeting on Friday, the Nikkei 225 slipped 0.7%. That was despite a 23.7% jump for Nissan Motor Corp., which said it was in talks on closer collaboration with Honda Motor Co., though no decision had been made on a possible merger. Honda Motor’s stock lost 3%.

Nissan, Honda and Nissan alliance member Mitsubishi Motors Corp. agreed in August to share components for electric vehicles like batteries and to jointly research software for autonomous driving to adapt better to dramatic changes in the auto industry.

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AP Writer Zimo Zhong contributed.