Tech Rally Lifts S&P 500 Toward Record Before Fed Decision

US stocks moved higher, edging closer to record territory, as gains in technology shares helped offset weakness elsewhere in the market. Investors positioned themselves ahead of a busy week that includes major corporate earnings releases and a closely watched Federal Reserve policy decision.

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The S&P 500 opened Tuesday with a modest 0.2% advance, putting the benchmark index within striking distance of a new closing high. Momentum was driven largely by strength in technology names, as traders looked ahead to results from key industry leaders and weighed expectations for interest rates. The Nasdaq also climbed, reflecting renewed confidence in growth-oriented stocks.

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Technology shares provided the market’s primary lift, continuing a trend that has defined much of the year’s rally. Investors appear increasingly willing to add exposure ahead of earnings, betting that demand tied to artificial intelligence, cloud computing, and data infrastructure will remain resilient. While valuations remain a point of debate, recent results have reinforced the view that earnings growth can still justify premium pricing in parts of the sector.

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One standout was Corning Inc., which emerged as one of the top performers in the S&P 500. The company’s shares jumped after it announced a $6 billion agreement to supply fiber-optic cables to Meta Platforms Inc., the parent company of Facebook. The deal underscored ongoing investment in digital infrastructure and data connectivity, themes that continue to support long-term growth across the technology ecosystem.

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Not all sectors shared in the optimism. Health insurers came under heavy pressure, dragging on broader gains. Shares of major insurance providers fell sharply after reports suggested Medicare Advantage payment rates are likely to remain flat for the year. The prospect of stagnant reimbursement raised concerns about margin compression, especially as healthcare costs continue to rise.

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The selloff in insurers highlighted how quickly policy expectations can reshape sector-level performance. Even as the broader market pushed higher, investors rotated away from areas perceived to be facing regulatory or pricing headwinds. The divergence reinforced the importance of selective positioning as markets approach record levels.

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Beyond equities, attention remained firmly fixed on the Federal Reserve. Policymakers are set to deliver their latest interest-rate decision later this week, with markets widely expecting rates to remain unchanged. Investors will be parsing the Fed’s statement and projections for clues on the timing and pace of potential rate cuts later in the year.

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While inflation has cooled from its peaks, it remains above the Fed’s long-term target, keeping officials cautious. Recent economic data has painted a mixed picture, showing signs of slowing momentum alongside pockets of resilience. That backdrop has left markets sensitive to any shift in tone from Chair Jerome Powell regarding the outlook for growth, inflation, and monetary policy.

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Bond markets were relatively steady ahead of the decision, suggesting investors are largely comfortable with current expectations. Treasury yields held in narrow ranges, reflecting a wait-and-see approach as traders look for confirmation that the Fed is moving closer to easing policy without risking a resurgence in inflation.

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The broader market mood remains constructive. Strong earnings from several large-cap companies have helped reinforce confidence that corporate profits can continue to support equity prices, even at elevated levels. With the S&P 500 already up significantly this year, investors are increasingly focused on whether earnings growth can keep pace with valuations.

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At the same time, pockets of volatility persist beneath the surface. Sector rotations, policy uncertainty, and geopolitical risks continue to influence day-to-day trading. The sharp contrast between technology strength and healthcare weakness is a reminder that market leadership can shift quickly as new information emerges.

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For investors, the coming days could prove pivotal. Key earnings reports from major technology companies, combined with guidance from the Federal Reserve, are likely to shape near-term market direction. A supportive message from policymakers and solid corporate results could provide the catalyst for the S&P 500 to push decisively into record territory.

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As markets hover near historic highs, discipline remains essential. While momentum favors the upside, selective stock picking and attention to policy signals will be critical in navigating the next phase of the rally. For now, technology continues to set the pace, keeping US equities within reach of new milestones as investors brace for a defining week.

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