US open: Stocks mixed as investors eye Fed announcement

US stocks were mixed at the open on Monday as investors awaited the Federal Reserve’s last policy announcement of 2023.

At 1535 GMT, the Dow Jones Industrial Average was 0.2% higher, while the S&P 500 and the Nasdaq were up 0.1% and down 0.3%, respectively.

The Fed is widely expected to maintain the funds rate in the 5.25%-5.5% range on Wednesday.

Joshua Mahony, chief market analyst at Scope Markets, said: "Inflation looks set to dominate this week, with tomorrows US CPI release likely to help outline the trajectory towards target. With energy prices having been hit hard under the weight of record US crude oil production, the headline inflation gauge looks primed to head lower despite somewhat cautious expectations.

"The eurozone November figure of -0.5% highlights the potential for US CPI to similarly post a negative monthly figure, which would undoubtedly help highlight a trajectory that may justify market expectations of a March return to target.

"Friday’s US jobs report provided the basis for a more hawkish stance at the Fed this week, with markets gradually easing back on their rate cut expectations. With questions remaining over whether headline (3.2%) and core PCE (3.5%) inflation will hit target by March, the strength of the US jobs market highlights the potential for a relatively hawkish take from the Federal Reserve on Wednesday.

"The Federal Reserve forecasts should provide a strong basis for markets to base their expectations upon, and it has become quite apparent that the US jobs market remains incredibly resilient despite the restrictive actions of the Fed."

In corporate news, Macy's surged more than 15% after news broke that the retailer had received a $5.8bn buyout offer from an investor group consisting of Arkhouse Management and Brigade Capital.

Occidental Petroleum was in focus after agreeing to buy CrownRock, a privately-held oil and gas producer that operates in the Permian basin, for around $12bn.

BlackBerry was also in the spotlight after saying it has appointed industry veteran John J. Giamatteo as its new chief executive officer with immediate effect, and announcing plans to separate its IoT and cybersecurity businesses.

Elsewhere, Pinterest was boosted by a rating upgrade at RBC Capital Markets.