US stocks open higher on tech strength with Fed rate-cut odds near 90%

US stocks edged higher on Monday, with the S&P 500 kicking off the week in the green, leaning on a tech-led rally to shake off pre-Fed jitters.

At open, the S&P 500 was trading around 6,875.33, 0.20% up from the previous close, while the Nasdaq was 0.30% up at 23,664.14.

The Dow Jones Industrial Average opened slightly in the red on Monday and was trading at 47,868.43, 0.18% down from Friday’s closing.

Dealmaking stole the spotlight Monday, with Confluent skyrocketing 29% after IBM agreed to snap up the data-streaming platform in an $11 billion transaction expected to close in mid-2026.

Ahead of the opening bell, a major hostile bid shook the sentiment as Paramount Skydance made a $108.4 billion offer for the acquisition of Warner Bros. Discovery.

The bid is seen as hostile, as Netflix announced a $72 billion deal on Friday to acquire WBD.

What happened in pre-market trading?

The mood is cautiously optimistic in the pre-market trade on Monday, thanks to Friday’s softer-than-expected inflation report, which essentially cemented the case for a rate cut this Wednesday.

Bond markets are now pricing in an 87% chance that the Fed will trim rates to the 3.50%-3.75% range.

Elsewhere, the “risk-on” signals are mixed but steady. Bitcoin is clawing its way back, trading near $92,000 after a brief dip below $89,000 overnight.

Crude oil is drifting lower, down roughly 1% to $59.45 a barrel, likely reflecting demand concerns.

Meanwhile, the 10-year Treasury yield is holding steady at 4.16%, giving equity traders a relatively calm backdrop as they wait for Jerome Powell to take the microphone later this week.

All eyes on Powell and a fractured Fed

Wednesday is undoubtedly the main event. While a quarter-point rate cut is widely viewed as a done deal, priced in by nearly everyone, the real fireworks will likely happen during Chair Powell’s post-meeting press conference.

Analysts warn that the cut itself matters less than the guidance for 2026. The big question is whether Powell will validate the bulls, hoping for a sustained easing cycle, or disappoint them with a “hawkish cut.”

Economists at Wells Fargo are bracing for drama, predicting potential dissents from a fractured committee where hawks want a pause and doves are pushing for aggressive relief.

Before the Fed takes center stage, we get a critical data dump.

Tuesday brings the delayed JOLTS report at 10:00 AM ET, finally giving investors a look at October’s hiring trends following the data blackout caused by the government shutdown.

On Wednesday morning, the Employment Cost Index will drop just hours before the Fed decision, offering a final clue on wage inflation.

By Thursday, attention shifts to weekly jobless claims for the most up-to-date read on whether the labor market is cracking or merely cooling.

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