Market Wrap | S&P 500 Rises as Fed Rate Cut Debate Intensifies

On September 15, 2025, the S&P 500 Index rose by 0.47%, the Dow Jones Industrial Average increased by 0.11%, and the Nasdaq Composite Index surged by 0.94%. Former St. Louis Fed President James Bullard expressed interest in becoming the next Fed Chair, emphasizing the importance of maintaining low inflation and protecting the central bank's independence. Meanwhile, Morgan Asset Management's David Kelly cautioned that anticipated Fed rate cuts could potentially harm the stock and bond markets if perceived as politically motivated.

Based on the day's market performance, the technology, non-essential consumer goods, and communication services sectors outperformed the S&P 500. Notably, the communication services sector showed exceptional performance. Conversely, the healthcare, essential consumer goods, energy, materials, real estate, and financial sectors moved in the opposite direction of the S&P 500.

The upcoming Federal Reserve meeting is expected to initiate a rate cut process, with markets widely anticipating a 25 basis point reduction due to weak employment figures. This expected rate cut has stirred debate, with concerns that political pressure might drive the decision, potentially affecting stocks, bonds, and the dollar adversely. President Trump has voiced expectations for a significant rate reduction, further emphasizing the political dynamics influencing the Federal Reserve's actions. Meanwhile, Citigroup analysts predict that the slow pace of rate cuts will continue to suppress demand for long-term U.S. Treasury bonds. Additionally, Morgan Asset Management warns that a rate cut driven by political motives might increase risks across various financial markets.