Market participants await the outcome of the FOMC meeting that will start today. Traders and investors widely expect the FOMC to follow up June’s large 75bp rate increase with a similar move in July, lifting the target range for the Fed Funds rate to 2.25%-2.50%. An increase of this size would effectively end the era of support for the economy that was associated with the pandemic.

Equities:

In Wall Street, The S&P 500 ended close to unchanged as investors girded for an expected rate hike at Fed’s meeting, this week and earnings from several large-cap growth companies. The Nasdaq ended lower, and S&P 500 technology and consumer discretionary led declines among major S&P sectors. The energy sector gained along with oil prices. Markets are generally waiting for all this week’s developments to play out.

The S&P 500 rose 5.21 points, or 0.13%, to 3966.84. The Dow Jones Industrial Average rose 12 points, or 0.04%, to 31901, and the Nasdaq Composite declined 101 points, or 0.81%, to 12300.4.

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Currency Market:

- The US dollar fell against a basket of major currencies as investors weighed the effects of an increase in interest rates from the Federal Reserve on an economy that may be on the brink of recession.

- The dollar index fell 0.244 percent to 106.42 points, with the euro rising 0.14 percent to $1.0224. The Japanese currency fell 0.44 percent against the US currency to 136.65 yen to the dollar. The lack of news was perfectly good news for high-yielding currencies. The GBP/USD pair trades at around 1.2050, while AUD/USD nears July high at 0.6977. On the other hand, the USD/CAD pair is down to 1.2840.

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Commodities: Gold

- Gold turns negative as market sentiment deteriorates. The price slides below $1,721, rejected again from above $1,730. Meanwhile, the US Dollar recovers momentum, erases losses. The US central bank is expected to raise interest rates by 75 basis points after its monetary policy committee meeting on Wednesday.

- The yellow metal is correcting lower and is testing the $1,715 area. A break lower could open the doors to $1,700. If it rises back above $1,725, another test of $1,740 could take place. The key resistance above is at $1750.

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Commodities: Oil

- Oil prices rose for the second day in a row amid growing fears of tight European supplies after Russia, a major oil and natural gas supplier to the region, cut gas supplies through a major pipeline.

- Brent crude futures for September rose $1.51, or 1.4 percent, to $106.66 a barrel, having jumped 1.9 percent the previous day. WTI crude contracts for September also increased $1.36, or 1.4 percent, to $98.04 a barrel.

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