NEW YORK (AP) – The S&P 500 rose to a record high Tuesday as Wall Street made final moves before hearing what the Federal Reserve will do about interest rates.
The benchmark index rose 29.09 points, or 0.6%, to 5,178.51, surpassing its all-time high reached last week. The Dow Jones Industrial Average rose 320.33, or 0.8%, to 39,110.76, and the Nasdaq Composite rose 63.34, or 0.4%, to 16,166.79.
All three indexes erased their losses from the previous session and rose.
International Paper rose 11%, the biggest gain in the S&P 500, after the company named Andrew Silvernail, an executive at investment firm KKR, as its new CEO.
Unilever's U.S.-traded shares rose 2.8% after the company announced it would separate Ben & Jerry's and its ice cream business, cutting 7,500 jobs.
Nvidia has been strong all day, going from one of the heaviest weights to one of the most powerful propellants on the market. Its sheer size gave it a huge influence on the index, which turned it from a drop of nearly 4% to a gain of 1.1%.
The company announced new products at a developer conference the previous day, which analysts said would put Nvidia ahead of its competitors. The company's stock price had already more than tripled in the past 12 months, fueled by excitement around its artificial intelligence technology.
Wall Street's loser was Super Micro Computer, whose stock price soared from less than $100 to more than $1,000 in one year. The company, which sells servers and storage systems used in AI and other computing, fell 9% after it said it was considering selling 2 million shares of its stock.
Elsewhere on Wall Street, the focus was on the Federal Reserve.
The Fed has begun its latest meeting on interest rates and is expected to announce a decision on Wednesday. There are widespread expectations that key interest rates will be left unchanged at the highest level in 20 years. The bank is expected to signal that it expects to cut interest rates three times this year, as it hinted several months ago.
The record rally in U.S. stocks is driven in part by hopes of lower interest rates, which will ease pressure on the economy and financial system. But recent reports on inflation have been consistently worse than expected. That could force the Fed to say it will cut rates less this year, and traders have already given up early hopes that the first rate cut of the year will come on Wednesday.
Bank of America strategists expect Fed officials to stick to their outlook, which shows the median member expects three rate cuts in 2024. But it's a close call, and strategists led by Mark Kavanagh say “risks are skewed toward fewer signals to cut rates.”
Ahead of the announcement, U.S. bond yields fell in the bond market. The yield on the 10-year U.S. Treasury note fell to 4.29% from 4.33% late Monday.
High yields and interest rates can cause stock prices to fall broadly, but they can also suck dollars and enthusiasm out of excited parts of the market.
Bitcoin prices have generally declined since peaking above $73,000 last week. They are notorious for exposing investors to wild price fluctuations. It fell further on Tuesday, falling below $63,900.
In overseas stock markets, Japan's Nikkei Stock Average rose 0.7% after the Bank of Japan raised its base interest rate for the first time in 17 years. In a historic move, the bank made changes that included returning the policy rate to a range of zero to 0.1%, ending a long experiment with below-zero interest rates aimed at boosting the economy and inflation.
Analysts say interest rate policy remains accommodative, with the era-defining move widely expected.
Embattled real estate developer China Evergrande Group has announced that China's market watchdog has fined it 4.2 billion yuan ($333.4 million) for alleged violations including revenue misrepresentation. As a result, stock prices fell by 1.2% in Hong Kong and 0.7% in Shanghai.
Elsewhere in Asia and Europe, stocks were mixed.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
