The stock market started to recover from the losses suffered on Monday, especially in the volatile trading session ahead of the two-day FOMC meeting scheduled to start this week.
The Dow Jones Industrial Average traded 126 points, or 0.41% higher, while the S&P 500 and Nasdaq Composite rose 0.29% and 0.23%, respectively.
Investors are focused on the Fed's latest policy meeting scheduled to start early Thursday morning Malaysian time. The Central Bank is expected to raise interest rates by another three-quarters of a point, although investors are also eyeing guidance on corporate earnings ahead of its next report in October.
Keith Lerner of Truist thinks the market does not have much confidence in the market ahead of the Fed. The market is focused on the upcoming meeting of the Fed and Lebin tends to expect a 'hawkish' result in the market.
On the other hand, the 10-year Treasury yield topped 3.5% on Monday, the highest level in 11 years as rates continued to rise ahead of this week's Fed decision which is expected to raise its benchmark rate by three quarters.
All 11 major S&P 500 sectors rose or traded flat, led by gains in industrials and materials. Financial markets also moved higher.
Stocks tumbled last week as investors reacted to reports of higher-than-expected inflation and a warning notice from FedEx about a "significantly decelerating" global economy.
Besides the Fed meeting, there were only a few economic data releases during the week including August housing data and jobless claims on Thursday.
