US close: Stocks pull back ahead of Fed decision

(Sharecast News) - Wall Street stocks declined on Monday despite some M&A excitement in the entertainment sector, as markets pulled back from levels not seen in over a month with investors pausing for breath after two straight weeks of gains.

The Dow fell 0.5%, the S&P 500 slipped 0.4%, while the Nasdaq edged 0.1% lower.

Markets rose on Friday as the delayed release of September's core personal consumption expenditures index buoyed sentiment, helping major indices log a second positive week in a row. Core PCE - the Federal Reserve's preferred measure of inflation - unexpectedly eased from 2.9% to 2.8%, cementing hopes that the central bank will cut interest rates at its two-day meeting starting Tuesday.

Investor confidence has improved in recent weeks, with traders now pricing-in an approximately 90% chance that the Fed cuts rates at its final gathering of 2025, according to CME's FedWatch tool, up from less than 67% a month ago.

As a result, the S&P 500 finished last week at its highest since 29 October, while the Nasdaq reached levels not seen since 3 November.

"It's been another odd day for markets as investors continue their game of wait and see ahead of the Fed's meeting on Wednesday," said AJ Bell head of financial analysis Danni Hewson.

"For many it will be hard to see beyond what is expected to be a contentious vote, but markets have had more than enough corporate news to keep them occupied."

Rising bond yields were also weighing on stocks ahead of the Fed decision, amid speculation that this week's widely expected rate cut could be the last one for some time. The yield on a 10-year US Treasury rose 2.6 basis points to 4.167% - its highest since mid-October.

Market movers

With no major corporate earnings or economic data released on Monday, the focus was firmly on Warner Bros Discovery after Paramount Skydance launched a $108bn hostile takeover offer of the movie studio and streaming network, just days after Netflix agreed a bid worth $83bn.

Paramount said its rival $30-a-share all cash offer "provides superior value, and a more certain and quicker path to completion to WBD shareholders" than the Netflix deal, which sparked a backlash over competition concerns.

Warner Brothers finished firmly higher, along with Paramount Skydance, while Netflix dropped into the red.

Confluent shares shot up 29% after IBM announced its intention to acquire the company in an $11bn deal, expected to close by mid2026.

Broadcom shares were 3% higher after a report from The Information revealed Microsoft was mulling the idea of collaborating on custom chips with the firm.

Dow Jones - Risers

Walt Disney Co. (DIS) $107.68 2.21%

Boeing Co. (BA) $206.12 2.17%

Microsoft Corp. (MSFT) $491.02 1.63%

Goldman Sachs Group Inc. (GS) $865.77 1.42%

Cisco Systems Inc. (CSCO) $78.86 1.14%

International Business Machines Corporation (CDI) (IBM) $309.34 0.40%

Coca-Cola Co. (KO) $70.35 0.36%

JP Morgan Chase & Co. (JPM) $314.66 0.05%

Walgreens Boots Alliance, Inc. (WBA) $0.00 0.00%

Dowdupont Inc. (DWDP) $0.00 0.00%

Dow Jones - Fallers

Procter & Gamble Co. (PG) $138.79 -3.56%

Nike Inc. (NKE) $63.59 -3.52%

Intel Corp. (INTC) $40.30 -2.68%

Amgen Inc. (AMGN) $321.23 -2.63%

Unitedhealth Group Inc. (UNH) $323.13 -2.20%

American Express Co. (AXP) $362.63 -2.18%

3M Co. (MMM) $163.73 -2.10%

Walmart Inc. (WMT) $113.53 -1.35%

Visa Inc. (V) $326.67 -1.33%

Home Depot Inc. (HD) $349.04 -1.33%

S&P 500 - Risers

Bath & Body Works, Inc. (BBWI) $19.65 4.35%

Micron Technology Inc. (MU) $246.92 4.09%

Molson Coors Beverage Co. Class B (TAP) $46.66 3.30%

Lockheed Martin Corp. (LMT) $465.40 2.91%

Broadcom Inc. (AVGO) $401.10 2.78%

Weyerhaeuser Co. (WY) $22.26 2.72%

Corning Inc. (GLW) $88.16 2.68%

Lam Research Corp. (LRCX) $162.74 2.55%

American Tower Corp (Reit) (AMT) $182.59 2.43%

Microchip Technology Inc. (MCHP) $67.35 2.34%

S&P 500 - Fallers

Air Products & Chemicals Inc. (APD) $235.28 -9.45%

Dollar General Corp (DG) $124.04 -6.12%

Incyte Corp. (INCY) $96.70 -5.68%

VF Corp. (VFC) $17.99 -5.35%

PVH Corp. (PVH) $74.78 -4.65%

Under Armour Inc. Class A (UAA) $4.36 -4.18%

Gap Inc. (GAP) $25.51 -3.92%

D. R. Horton Inc. (DHI) $152.55 -3.90%

Fortinet Inc. (FTNT) $83.53 -3.90%

Clorox Co. (CLX) $101.35 -3.78%

Nasdaq 100 - Risers

Micron Technology Inc. (MU) $246.92 4.09%

Broadcom Inc. (AVGO) $401.10 2.78%

Lam Research Corp. (LRCX) $162.74 2.55%

Microchip Technology Inc. (MCHP) $67.35 2.34%

Seagate Technology Plc (STX) $284.87 2.18%

Asml Holdings N.V. (ASML) $1,119.69 1.84%

Nvidia Corp. (NVDA) $185.55 1.72%

eBay Inc. (EBAY) $83.85 1.67%

Microsoft Corp. (MSFT) $491.02 1.63%

Wynn Resorts Ltd. (WYNN) $127.13 1.29%

Nasdaq 100 - Fallers

Incyte Corp. (INCY) $96.70 -5.68%

Vertex Pharmaceuticals Inc. (VRTX) $442.04 -2.95%

Intel Corp. (INTC) $40.30 -2.68%

Amgen Inc. (AMGN) $321.23 -2.63%

Intuit Inc. (INTU) $656.24 -2.58%

Comcast Corp. (CMCSA) $26.65 -2.42%

Alphabet Inc. Class C (GOOG) $314.45 -2.37%

Alphabet Inc. Class A (GOOGL) $313.72 -2.35%

Trip.com Group Limited (TCOM) $70.15 -2.23%

NetEase Inc. Ads (NTES) $136.83 -2.11%