Nasdaq, S&P 500 Inch Up To New Record Highs Amid Choppy Trading

With traders looking ahead to the Federal Reserve’s monetary policy announcement on Wednesday, stocks have shown a lack of direction in morning trading on Tuesday. Despite the choppy trading, the Nasdaq and the S&P 500 have inched up to new record intraday highs.

Currently, the major averages are all posting modest gains. The Dow is up 28.97 points or 0.1 percent at 35,942.81, the Nasdaq is up 22.65 points or 0.2 percent at 15,618.57 and the S&P 500 is up 10.30 points or 0.2 percent at 4,623.97.

Traders seem somewhat reluctant to make more significant moves ahead of the Federal Reserve’s monetary policy announcement.

The Fed is expected to announce plans to begin gradually scaling back its $120 billion in monthly bond purchases by mid-November or December.

The language of the Fed’s statement is likely to be in focus as traders look for clues about the outlook for interest rates amid concerns about the high rate of inflation.

A lack of major U.S. economic data may also be keeping traders on the sidelines ahead of the release of the Labor Department’s closely watched monthly jobs report on Friday.

Substantial strength has emerged among transportation stocks, as reflected by the 7.1 percent surge by the Dow Jones Transportation Average. The average has reached a record intraday high.

Shares of Avis Budget (CAR) have skyrocketed after the car rental company reported better than expected third quarter results.

Networking stocks have also moved sharply higher in morning trading, with the NYSE Arca Networking Index spiking by 4 percent to a record intraday high.

Arista Networks (ANET) has soared after the networking company reported better than expected third quarter results and provided upbeat guidance. Arista also announced a $1 billion share repurchase program and a four-for-one stock split.

Computer hardware stocks are also seeing considerable strength on the day, while steel, gold and biotechnology stocks have moved to the downside.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan’s Nikkei 225 Index fell by 0.4 percent, while China’s Shanghai Composite Index slumped by 1.1 percent.

Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.’s FTSE 100 Index has slid by 0.5 percent, the French CAC 40 Index is up by 0.3 percent and the German DAX Index is up by 0.9 percent.

In the bond market, treasuries have moved to the upside after ending the previous session modestly lower. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.9 basis points at 1.556 percent.