And that brings us to the main event of the day: the Fed’s policy meeting, which concludes on Wednesday with the 2 p.m. EDT (1800 GMT) release of a policy statement followed half an hour later by a news conference by Chair Jerome Powell.
Traders are pricing in a 15% chance of a 25 basis-point interest rate hike by the Fed and an 85% chance of no increase. Just a month earlier, the market was pricing in a 24% chance of a 50 basis-point hike.
The past two weeks have upended expectations, with market funding conditions tightening sharply since the collapse of Silicon Valley Bank and a rout in Credit Suisse shares that led to a shotgun takeover on Sunday by Swiss rival UBS.
Whether that’s enough for central banks to stop hiking remains to be seen.
The MSCI ex-Japan index rose 1.3%, while the dollar and gold traded in narrow ranges. Futures indicated European stocks would likely join in on the rally.
In the corporate world, GameStop posted a surprise profit for the fourth quarter, its first since early 2021, sending the “meme stock” nearly 50% higher. Shares of another meme stock, Bed Bath & Beyond, fell below $1, leaving the retailer at risk of losing additional funding from hedge fund Hudson Bay Capital Management. The retailer reached an amended agreement with Hudson last week to temporarily lower the stock price threshold to $1 until April 3.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/242H5BIU55ICBE3MJI477QY464.jpg "Jittery markets attempt risk-on rally while waiting for Powell 29")
