Stocks Mixed Ahead of Fed Decision; Investors Weigh AI Risks and StubHub IPO

U.S. stocks opened mixed Wednesday as Wall Street braced for the Federal Reserve’s closely watched interest rate decision this afternoon, a move that could set the tone for markets heading into year-end.

The Dow Jones Industrial Average rose 150.21 points (0.33%) to 45,908.1, while the S&P 500 edged up 3.63 points (0.05%) to 6,610.39. The Nasdaq Composite, however, slipped 4.82 points (0.02%) to 22,339.1.

Commodities traded lower in early dealings. Crude oil (Nov. 2025 contract) slipped 0.33, or 0.51%, to $64.19 a barrel, while gold (Dec. 2025 contract) fell $14.00, or 0.38%, to $3,711.10 an ounce. Analysts said both moves reflect investors holding back until the Fed’s statement clarifies the trajectory for real rates.

WATCH: Jay Hatfield: Fed Cuts Could Fuel a 1990s-Style Boom

Fed in Focus

At 2 p.m. ET, the Fed is expected to announce a 25-basis-point rate cut, followed by Chair Jerome Powell’s press conference at 2:30 p.m. Investors will parse Powell’s tone for whether the move is framed as a recalibration—policy still restrictive but less tight—or as a response to potential cracks in the economy.

Recent retail sales data show consumers remain resilient, with August sales up 0.6% month-over-month and 5.0% year-over-year. That strength complicates the Fed’s balancing act: cutting rates without signaling recession concerns. Bank of America strategist Michael Hartnett warned that “rising growth expectations keep the bull case in charge,” but history suggests equities often stumble in the first month after a cut before regaining momentum.

AI Concentration Risk

Beyond monetary policy, investors are grappling with extreme concentration in artificial intelligence stocks. A new Apollo Global Management study led by Torsten Slok finds the “AI bubble today is bigger than the IT bubble in the 1990s”, with the top 10 companies—dominated by NVIDIA, Microsoft, Apple, and peers—trading at average P/E ratios near 50. The research shows earnings growth is disproportionately concentrated in the “Magnificent Seven,” while small- and mid-cap firms lag, underscoring market fragility if AI leaders stumble.

Yet Citi Research offers a counterweight. In a note titled Productivity & the AI Revolution , economists Nathan Sheets and Robert Sockin argue AI diffusion is proceeding at a historically rapid pace. While productivity gains remain nascent, Citi estimates 20–40% of tasks could be automated over the next decade, potentially boosting U.S. productivity growth by 0.5 to 1.5 percentage points annually. In Citi’s words, AI may ultimately deliver a “Goldilocks” backdrop of stronger growth and subdued inflation, though the market is vulnerable if benefits prove slower to materialize.

IPO Spotlight: StubHub Debuts on NYSE

Adding to today’s packed calendar, StubHub begins trading on the New York Stock Exchange under the ticker STUB. The ticketing marketplace priced its IPO at $22–$25 per share, raising roughly $800–$851 million at a valuation near $9 billion. J.P. Morgan and Goldman Sachs lead the deal. The listing comes against a mixed backdrop for consumer-facing IPOs in 2025, with several high-profile names handing back early gains. StubHub touts strong cash generation and network effects but faces tighter fee regulations and competition from Ticketmaster. Investors will be watching whether StubHub avoids the fate of this year’s other flashy debuts.

Markets are positioned for volatility. A dovish Fed cut could fuel a late-year rally, while any hint of economic weakness may sour sentiment. Meanwhile, AI remains both the market’s engine and its biggest risk. StubHub’s first-day performance will offer another test of investor appetite for consumer IPOs in a market dominated by mega-cap tech.