US stocks dip ahead of Fed meeting

US stocks dipped ahead of a consequential Federal Reserve meeting this week, at which the central bank is expected to offer some clues about its path forward.

Wall Street’s benchmark S& P 500 fell 0.4 percent on Tuesday, erasing earlier gains, while the tech- heavy Nasdaq Composite dropped 0.9 percent. The S& P 500 fell during the previous session but notched a gain of almost 8 percent for October.

The central bank’s Federal Open Market Committee is expected to implement its fourth consecutive 0.75 percentage point rate rise on Wednesday in an attempt to cool inflation that remains at the highest level in decades. Investors will also be watching closely for any indication that the Fed is prepared to slow its pace of raises in December.

Traders are mixed on the outcome of the December meeting: futures markets show a 49 percent chance of a 0.75 percentage point increase, and a 44 percent chance of a smaller increase of 0.5 percentage points. Robust jobs data released on Tuesday show a still healthy labour market, which, if it persists, could diminish the possibilities of a smaller rise in December. But interest rate expectations in the futures market on Tuesday were little moved.

Demand for US workers rebounded in September, with employers adding 437,000 job openings, bringing the total number of vacancies to 10.7mn, the labour department said. The figures represented “another example of data ‘ not co- operating’ with the Fed’s desire to slow the pace of rate hikes”, said analysts at Citigroup.