Nasdaq, S&P 500 Hit Record Highs Ahead of Fed Decision; Nvidia Nears $5 Trillion Valuation

On Wednesday, U. S. stock markets rallied with the Nasdaq Composite and the S&P 500 setting new record highs ahead of the highly anticipated Federal Reserve interest rate decision. Optimism in the tech sector, led by Nvidia, pushed the indices higher as investors waited for cues on the Fed's direction for monetary policy.

The Nasdaq Composite had gained 0.6%, while the S&P 500 was up 0.3%, with both indexing at new record ceilings. The Dow Jones Industrial Average added another 200 points (0.4%), extending Wall Street's streak of registries.

Nvidia Tops $5 Trillion Market Cap

Chipmaker Nvidia surged over 4%, pushing its market capitalization above $5 trillion — the first U.S. company to reach this milestone. The rally spread across the semiconductor sector, with AMD up 3% and Micron Technology gaining nearly 3%.

Investors Eye Federal Reserve Rate Cut

Markets broadly expect the Federal Reserve to announce the quarter-point rate cut at the conclusion of its policy meeting on Wednesday. The focus instead will be on the tone taken by Chair Powell-whether he would signal any further easing or play the cautious approach.

Other expected rate cuts priced into the market could be in December 2025. This is exempt from the possibility of inflation showing signs of stabilization.

Tech Giants to Report Earnings

Investor attention also turns to the “Magnificent Seven” tech firms, with Alphabet, Meta Platforms, and Microsoft scheduled to report earnings after Wednesday’s market close. Apple and Amazon are set to release results on Thursday. Analysts expect these companies to continue heavy investments in AI and data center infrastructure, but warn that any disappointment could weigh on broader market sentiment.

Global Trade Sentiment Boosts Market Confidence

Trade relations between the U.S. and China have shown improvement following weekend negotiations, and investors are awaiting updates from President Donald Trump’s meeting with Chinese President Xi Jinping in South Korea.

Market strategist Thierry Wizman of Macquarie Group said, “The market is seeing President Trump re-engaging with China and Japan, reducing the likelihood of new tariffs. This also supports expectations of a dovish Fed as easing trade tensions could help contain inflation.”

Key Stock Movers

Nvidia: Up 3.5% premarket, nearing $5 trillion valuation.

Caterpillar: Jumped 4% after reporting Q3 earnings of $4.95 per share on $17.64 billion revenue, beating estimates.

Fiserv: Crashed 28% following a major earnings miss and a guidance cut for the year.

Etsy: Shares plunged 9% as CEO Josh Silverman announced his decision to step down; Kruti Patel Goyal of Depop will take over as CEO in 2026.

Boeing: Fell 1% after posting a wider-than-expected loss of $7.47 per share despite revenue exceeding forecasts.

CVS Health: Dropped slightly in premarket after reporting a net loss of $3.99 billion despite beating revenue expectations at $102.87 billion.

Market Outlook

Despite risks such as elevated valuations and the ongoing U.S. government shutdown, analysts remain optimistic. Lauren Goodwin, Chief Market Strategist at New York Life Investments, said,

“I anticipate we’ll continue to see enthusiasm through the end of the year. The market appears free and clear for now.”