GLOBAL MARKETS-Stocks hit fresh record highs, dollar falls ahead of Fed move

Global shares hit a fresh record high on Monday as markets positioned for the U.S. Federal Reserve to begin its monetary policy easing cycle this week. Gold prices hit a record high as the U.S. dollar weakened. Traders widely expect the Fed to deliver a 25 basis-point cut at the end of its policy meeting on Wednesday, with the probability of such a move near 100%, according to CME's FedWatch tool.

MSCI's All-Country Index rose as high as 977.09, up 0.50%, topping last week's record high. On Wall Street, all three main indexes closed higher with the S&P 500 and Nasdaq hitting fresh intraday record highs. Communication services, consumer discretionary, and technology stocks were the biggest gainers while consumer staples, healthcare and materials equities drove losses.

The Dow Jones Industrial Average rose 0.11% to 45,883.45, the S&P 500 rose 0.47% to 6,615.28 and the Nasdaq Composite rose 0.94% to 22,348.75. Stocks in Europe rose 0.42% on the day, finishing near a three-week high with luxury and defense stocks boosting the main index "Today it looks like we're still in a wait-and-see mode for the Fed meeting and announcement," said Wasif Latif, chief investment officer at Sarmaya Partners in New Jersey. "We've had a big run up in the market that continues to see new highs in anticipation of the Fed and today seems to be moving in the same direction."

Key too will be Fed members' "dot plot" projections for rates and guidance from Fed Chair Jerome Powell on the extent and pace of any further easing. The yield on benchmark U.S. 10-year notes fell 2.4 basis points to 4.036%. Futures already have 125 basis points of cuts priced in by late 2026, so anything less than dovish will likely disappoint investors.

"What's interesting is that we've already seen prices move significantly in anticipation of the cut, so the question is will the rate announcement itself turn into a sell-on-the-news today or not," Latif added. U.S. President Donald Trump continued his attacks on the central bank on Sunday, saying Powell was incompetent and hurting the housing market. The Bank of Canada is also expected to cut rates by a quarter point this week, while the Bank of Japan and the Bank of England are both seen holding rates steady. In currencies, the U.S. dollar dropped against its peers ahead of the Fed's expected rate cut. It was down 0.17% to 147.42 against the Japanese yen and was down 0.27% to 0.79420 against the Swiss franc.

The dollar index fell 0.36% to 97.31. The euro shrugged off Fitch's downgrade of France late last week, rising 0.23% to $1.176075. It was a touch weaker against sterling, trading at 86.44 pence, down 0.1% on the day . The euro has been underpinned by a steady outlook for EU rates, with the European Central Bank signaling last week it was in a "good place" on policy. A host of ECB officials are due to speak this week, including President Christine Lagarde. The United States and China reached a framework agreement to switch short-video app TikTok to U.S.-controlled ownership, an arrangement that will be confirmed in a call between Trump and Chinese President Xi Jinping on Friday, U.S. officials said. Nvidia's finished flat, erasing earlier session losses, after China's market regulator said on Monday that a preliminary investigation had found that the company had violated the country's anti-monopoly law, marking the latest hit for the U.S. chip giant.

Oil prices rose as investors assessed the impact of Ukrainian drone attacks on Russian refineries. Brent crude futures settled up 0.67% to $67.44 a barrel. U.S. West Texas Intermediate crude CLc1 settled at $63.30 a barrel, up 0.97%.

Gold prices hit a new record high, underpinned by a softer dollar and lower Treasury yields. Spot gold rose 1.04% to $3,680.87 an ounce. It hit a record high of $3,685.39 earlier in the session.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)