NEW YORK (AP) — Stocks are rising Monday ahead of a busy week for central banks around the world that could determine the fate of interest rates.
The S&P 500 rose 1.1% in morning trading, marking its first consecutive weekly decline since October. It's nearing the all-time high it hit early last week, with Nvidia and other big tech stocks leading the way, as has become commonplace.
As of 10:30 a.m. ET, the Dow Jones Industrial Average was up 144 points, or 0.4%, and the Nasdaq Composite was up 1.7%.
The highlight for Wall Street this week will be the Federal Reserve's interest rate meeting, which concludes on Wednesday. There are widespread expectations that the central bank will keep its key interest rate unchanged at the highest level since 2001.
But Fed officials are also expected to release updated projections about where they see interest rates heading this year and over the long term. The government had earlier decided to cut interest rates three times this year to ease pressure on the economy and financial system.
However, recent reports on inflation have consistently been worse than expected. This could force the Fed to say it will cut interest rates less this year.
Such a move would be a huge disappointment for Wall Street. Stock prices are already rising on Wall Street, partly due to expectations of lower interest rates. In response to these expectations, yields on government bonds in the bond market have been falling since last fall, but losses have been mitigated by concerns about persistently high inflation.
Joe Davis, Vanguard's chief global economist, said the Fed is likely to keep key interest rates near current levels throughout this year. The investment giant recently raised its 2024 forecast that the U.S. economy will not fall into recession, but also slightly raised its forecast for the underlying inflation trend.
On the other side of the Pacific, the Bank of Japan is scheduled to announce its latest decision on interest rates on Tuesday. It has kept its policy interest rate below zero in hopes of controlling the economy and inflation, and has not changed it in 17 years.
Speculation is growing that Japanese workers' wages may be rising enough for the Bank of Japan to eventually raise interest rates.
Across the Atlantic, the Bank of England is expected to announce its latest decision on interest rates later this week.
On Wall Street, Nvidia rose 2.6% as its annual developer conference opened. Analysts say NVIDIA is widely expected to unveil its next-generation artificial intelligence architecture as AI use cases expand.
Nvidia CEO Jensen Huang is scheduled to give a keynote address after the day's close on Wall Street, along with a question-and-answer session with financial analysts on Tuesday.
The excitement around AI technology on Wall Street has driven the stock prices of NVIDIA and other companies so high that critics are calling it a bubble. Nvidia has grown to become the third largest stock on the US stock market. Nvidia was once again one of the strongest forces pushing the S&P 500 higher on Monday.
Wall Street's loser was Hertz Global Holdings, which fell 7.5%, taking its year-to-date loss to 32.4%. Chairman and CEO Stephen Shah will step down at the end of March. The company has appointed Wayne “Gil” West as CEO. He is a former executive at self-driving car company Cruise and Delta Air Lines.
Wall Street was trading mixed, with small-cap stocks in the Russell 2000 index down 0.3%.
Boeing fell another 1.6%, bringing its annual loss to 31.1%. The company has been plagued by concerns over manufacturing quality, with the latest negative headlines coming on Friday. After the old Boeing 737-800 arrived from San Francisco to its destination in southern Oregon, workers discovered a panel was missing.
In the bond market, the 10-year U.S. Treasury yield was flat at 4.31% as of late Friday.
In overseas stock markets, Japan's Nikkei Stock Average rose 2.7%. Share prices of Nissan Motor and Honda rose after the two companies agreed to collaborate in the field of electric vehicles.
Apart from a 1% rise in Shanghai stocks, movements were much more muted elsewhere in Asia and Europe.
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AP Business Writers Matt Ott and Zimo Zhong contributed.
