US open: Stocks trade higher ahead of Fed announcement
Wall Street stocks opened higher on Wednesday, with traders preparing themselves for the outcome of the Federal Reserve's latest policy meeting later in the day.
As of 1540 BST, the Dow Jones Industrial Average was ahead 0.20% at 27,252.20, while the S&P 500 was up 0.05% at 3,014.56 and the Nasdaq Composite started out the session 0.26% firmer at 8,295.45.
The Dow opened 54.48 points higher on Wednesday after closing softer on Tuesday as a fresh round of trade talks between Chinese and US officials kicked off in Shanghai.
While both sides were already looking to downplay expectations of a quick end to the trade war, Donald Trump further dampened any hopes that it would be possible after taking aim at China in a series of tweets.
On Tuesday morning, Trump said China was not keeping its promise of buying more US agricultural products and said the world's second-largest economy was "doing very badly". However, China insisted it has, in fact, purchased US agricultural products.
Looking ahead to later in the afternoon, the Federal Reserve was expected to make its first interest rate cuts since the financial crisis more than ten years ago. Investors were expecting a cut of 0.25% at 1900 BST.
Oanda's Craig Erlam said: "The stock market seems to hinge on the Fed to cut interest rates to a satisfactory degree while signalling more to come in the near future.
"While it would be easy for the Fed to deliver, I'm still not convinced they will. There has been a significant reluctance to cut rates until now, probably in part because it acknowledges that December's hike was a policy mistake and because it gives the impression that they're caving to pressure from the White House."
Erlam noted that while a rate cut was "almost guaranteed", he feared that markets would be disappointed by "the lack of a clear laid out path for more cuts in the coming months".
Elsewhere on the data front, private-sector payrolls in the States increased at a slightly quicker than expected pace in July, the results of a closely-followed survey revealed.
According to consultancy ADP, payrolls grew by 156,000 in July (consensus: 150,000) following an upwardly revised increase of 112,000 for June.
Elsewhere, one of the more closely-followed gauges of US manufacturing sector activity unexpectedly weakened again last month, amid indications of muted demand and with employment at its weakest since October 2009.
Market News International's Chicago Purchasing Managers' Index fell from a reading of 49.7 in June to 44.4 for July, missing economists' forecasts for an improvement to 51.8.
In corporate news, General Electric's second-quarter earnings came in ahead of expectations on the Street, while Spotify posted a bigger-than-expected loss as paid subscriber numbers disappointed.
Semiconductor manufacturer Qualcomm and mining outfit Vale were also slated to report on Wednesday.