U.S. equity indices closed lower on Monday as investors awaited the Federal Reserve’s policy decision, with the S&P 500 falling 0.4% and the Nasdaq Composite up 0.3% despite broader market weakness. Tech stocks, led by Nvidia and Microsoft, maintained gains amid strong earnings momentum.
- S&P 500: -0.4% to 5,312.78
- Nasdaq Composite: +0.3% to 17,438.02
- Nvidia revenue up 52% YoY
- Semiconductor index rose 1.8%
- 10-year Treasury yield at 4.62%
- CBOE VIX up 3.1% to 17.85
U.S. stock indices ended lower on Monday, weighed down by anticipation ahead of the Federal Reserve’s interest rate announcement. The S&P 500 dipped 0.4% to close at 5,312.78, while the Dow Jones Industrial Average declined 0.5% to 39,102.15. The Nasdaq Composite, however, edged up 0.3% to 17,438.02, supported by a rally in tech equities. Nvidia rose 2.1% after reporting a 52% year-over-year increase in quarterly revenue, driven by strong demand for AI chips. Microsoft gained 1.6% following a new cloud services expansion in Asia-Pacific markets. The divergence in market performance underscored investor focus on sector-specific fundamentals amid macro uncertainty. While financials and energy stocks lagged, with JPMorgan Chase down 1.3% and ExxonMobil slipping 0.9%, technology outperformed, accounting for over 60% of the Nasdaq’s gains. The Philadelphia Semiconductor Index rose 1.8%, reflecting optimism around AI-driven capital spending. Treasury yields rose slightly, with the 10-year note yield climbing to 4.62%, signaling expectations of a hold in rates at the Fed’s meeting. Market participants are bracing for the Fed’s decision, which is expected to maintain the benchmark federal funds rate at 5.25%-5.50% for the fifth consecutive meeting. A hold is widely anticipated, but the central bank’s forward guidance will be closely scrutinized for inflation signals and potential rate cuts in 2026. The CBOE Volatility Index (VIX) rose 3.1% to 17.85, indicating elevated risk aversion ahead of the announcement. The tech rally has been underpinned by consistent earnings beats and strategic investments in artificial intelligence infrastructure. Companies such as Amazon and Alphabet also reported strong cloud revenue growth, contributing to sector resilience. As the Fed decision looms, investors are balancing optimism on AI-driven productivity gains with concerns over persistent inflation and elevated borrowing costs.