Stocks hover around all-time high as investors await Fed meeting details

Expectations for continued central bank support help drive stock benchmarks higher

Markets settled into a holding pattern on Wednesday, with global stocks hovering around all-time highs as investors awaited details of the Federal Reserve’s most recent meeting. Bond yields fell.

Futures on the S&P 500 and Nasdaq 100 edged higher after the underlying gauges retreated overnight as volume on US exchanges dwindled below 10 billion shares for the first time this year. The 10-year Treasury yield dropped, while the dollar halted a four-day slide.

The Stoxx Europe 600 index was little changed. Amundi SA gained 3 per cent after agreeing to buy Societe Generale SA's fund management arm Lyxor.

Expectations for continued central-bank support and the strongest world expansion in at least four decades have driven stock benchmarks to unprecedented heights. Concerns about higher borrowing costs destabilizing the market have eased, with bond yields subsiding as traders pull their more-aggressive positioning for Fed policy tightening. Minutes of the last Fed rates meeting later Wednesday may provide more clues on the outlook.

"Central banks are continuing to keep interest rates so low, so people are looking for some place to put their money where they can get a return," Sarah Hunt, Alpine Woods Capital Investors associate portfolio manager, said on Bloomberg TV. "That's also why you have stocks priced somewhat for perfection."

Elsewhere, a gauge of Asia-Pacific equities fluctuated, with Toshiba Corp. surging after the company received an initial buyout offer from CVC Capital Partners. Indian shares rallied after the central bank retained its accommodative stance, seeking to support an economy facing a resurgence of coronavirus infections.

Oil held above $59 a barrel amid optimism that economic expansion will pick up. The International Monetary Fund upgraded its global growth forecast while warning about a divergence between advanced and less-developed economies. – Bloomberg