NEW YORK (REUTERS) - Wall Street was trading higher on Tuesday, helped by financial stocks, as investors await the Federal Reserve's decision on interest rates.
The central bank's two-day meeting will conclude with Fed Chair Janet Yellen's press conference at 2:00 p.m. ET on Wednesday (2:00 a.m Singapore time Thursday morning).
The doves in the Fed are most likely to rule over the hawks who support higher rates in the near term, but investors will assess the comments for clues on a likely hike in December.
Investors are also watching the Bank of Japan's meeting which started on Tuesday. Investors have little clue of what path the central bank could take to achieve its 2 per cent inflation target.
The markets have oscillated since Sept. 9 as investors second-guess the Fed's intention following a series of contradicting comments on the timing of the next hike from its officials.
Traders have priced in a 15 per cent chance of a rate hike by Wednesday, according to the CME Group's FedWatch tool.
At 9:42 a.m. ET (9:42 p.m Singapore time), the Dow Jones Industrial Average was up 72.32 points, or 0.4 per cent, at 18,192.49. The S&P 500 was up 7.42 points, or 0.35 per cent, at 2,146.54. The Nasdaq Composite was up 17.47 points, or 0.33 per cent, at 5,252.49.
The financial sector climbed 0.82 per cent and outperformed the other 10 major S&P 500 indexes.
"Investors are holding vigil before the Bank of Japan and the Federal Reserve's announcements tomorrow and I think everything stays quiet until then," said Peter Cardillo, chief market economist at First Standard Financial in New York.
The S&P 500 index showed two new 52-week highs and one new low, while the Nasdaq recorded 35 new highs and nine new lows.