Wall Street starts week on a mixed note

• Technology shares turn south on Monday to weigh on Nasdaq.
• Defensive sectors post gains in the early trade.
• Trading action is likely to remain subdued ahead of FOMC announcements.

Major equity indexes in the US look indecisive at the start of the week as investors are moving to the sidelines ahead of this week's key FOMC meeting, at which the Fed is expected to vote in favour of a 25 basis points rate cut to its policy rate. As of writing, the Dow Jones Industrial Average was up 0.1% on the day while the S&P 500 and the Nasdaq Composite were losing 0.25% and 0.73%, respectively.

Among the 11 major S&P 500 sectors, defensive Real Estate and Utilities post modest gains to reveal a sour market sentiment. On the other hand, the Technology and Communication Services indexes, which led last week's record-setting rally, are staging a technical correction, both losing around 0.5% on the day.

Attention turns to Fed

Previewing the FOMC meeting, "There is a lot of uncertainty as to the monetary policy signals that will follow a 25bp rate cut, though. How to deliver a slightly dovish message when markets expect more than you want to do?" asked Nordea Markets analysts.

"Powell could repeat that the Fed stands ready to act again if needed, If the Fed does not believe that to be enough, we see two additional options:: 1) balance-sheet normalisation could be slowed further or stopped altogether and 2) a “technical adjustment” of -5bp could be made to the IOER rate.”