US futures                                         

Dow futures 0.2%, S&P futures 0.3%  & Nasdaq futures 0.20%

In Europe

FTSE 0.03% & DAX 0.24%

• US stocks look to the Fed rate decision
• Stocks trade around record highs
• Tesla jumps 7% after Musk purchases 2.5 million TSLA shares
• Oil rises as Ukraine targets Russian oil infrastructure

Stocks look to this week’s FOMC rate decision

US stocks are set for a modestly higher open on Monday amid a cautious mood ahead of a pivotal week in which the Federal Reserve is expected to resume its rate-cutting cycle.

This week, the Federal Reserve's interest rate decision on Wednesday will take centre stage with the market fully pricing in a 25 basis point rate reduction following a series of data points that have shown a deteriorating jobs market.

With the rate cut fully priced in, attention will be on the Fed's growth and inflation projections as well as the dot plot. The Fed had guided for two rate cuts a year. However, that could be upwardly revised.

The market is pricing in 70 basis points worth of rate reductions between now and the end of the year, which implies almost three 25 basis point rate cuts this year, one to each of the Fed's remaining meetings.

Last week, US stocks scaled to fresh record highs and have continued to perform well in September, a month that is typically a weak month for equities.

Corporate news

Nvidia is falling over 1.6% after China’s regulator said it is extending an antitrust probe into the US chip maker after finding evidence that it breached the country’s anti-monopoly law.

Apple is rising over 1% after JP Morgan said that demand for the tech giant’s recently released iPhone 17 line appears to be stronger than the first week of sales for the iPhone 16 series.

Tesla rose 7.5% after CEO Elon Musk purchased 2.5 million shares in the EV maker.

Dow Jones forecast – technical analysis

The Dow Jones has been steadily trending higher, trading above its multi-month rising trendline, and is guided northwards by the 20 SMA. The price reached a record high of 46,140 on Friday before easing to 45,900 at the time of writing. Buyers will look to extend the rise above 46,140 to fresh record highs towards 47k. Support is seen at 45,450, the 20 SMA, and the rising trendline support. Below here, 44,950 comes into focus, the August 27 low.

FX markets – US falls, GBP/USD rises

The USD is falling as attention turns to the FOMC rate decision on Wednesday, where the central bank is expected to cut rates by 25 basis points. The market is pricing in 3 rate cuts before the end of the year.

The EUR/USD is rising amid a weaker USD and despite Fitch lowering France’s credit rating amid concerns of rising debt levels and political instability. The French bond yield has risen above that of peripheral European countries.

The GBP/USD is rising on diverging BoE – Fed expectations. The Fed is expected to cut rates aggressively across the year, while the BoE is expected to leave rates unchanged at 4% until next year. The Chancellor’s budget in November is expected to be pivotal for the UK outlook.

Oil rises as Ukraine targets Russian oil infrastructure

Oil prices are edging modestly higher, adding to last week’s gains as investors weigh up the impact of Ukraine attacks on Russian oil refineries and as Trump threatens more sanctions.

Ukraine ramped up its attack on Russian oil infrastructure this weekend, signaling a growing willingness to disrupt oil markets. This is adding a risk premium to oil prices.

Trump is also upping pressure on Russia, saying he was prepared to impose fresh energy sanctions on Russia, but only on the condition that NATO implemented similar measures.

The market will watch talks between the US and China closely, which kick off in Madrid today.