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Market moves : Stocks were relatively muted ing record closes for the S & P 500 and Nasdaq on Monday.
Investors are mostly sitting on their hands ahead of Wednesday's Federal Reserve interest rate decision. The central bank's policymaking committee is expected to cut interest rates by 25 basis points.
That's priced into the market, although there is still a low single-digit bability of a 50 basis point rate cut, according to the CME FedWatch tool.
While investors want to see rates decrease in hopes of unlocking the frozen housing industry and manufacturing sector, a 50-basis-point cut could spook Wall Street because it would signal the economy is in worse shape than what the currently believe.
At the same time, rate cuts are expected at every Fed meeting through January 2026. What Fed Chairman Jerome Powell has to say the rate path could move , too. U.S.
manufacturing : Eli Lilly announced on Tuesday plans to build a $5 billion plant near Richmond, Virginia.
The announcement comes as President Donald Trump has threatened significant tariffs against the pharmaceutical industry, which relies on imports from Europe.
Lilly has been one of the more aggressive pharma companies when it comes to reshoring plans. The company said in February it was doubling its investment in U.S.
manufacturing to over $50 billion since 2020 by building four new pharmaceutical sites.
The new facility marks the first of the four, and it's one of three that will focus on manufacturing so-called active pharmaceutical ingredients and drug ducts used in targeted cancer and autoimmune drugs.
Eli Lilly currently does not have a plant that makes these ducts, and CEO David Ricks told CNBC's Angelical Peebles that this facility will allow the company to move some of its duction from third parties and "other nodes in our network, mostly from Europe," to the new site.
Conference s : The industrials were mostly lower on Tuesday, and part of the reason could be in response to Emerson Electric 's downbeat s at a JPMorgan conference.
CEO Lal Karsanbhai described the current environment as one that is split by geographies and verticals.
Karsanbahi noted that this has been a year in which the areas of strength got stronger as the year gressed, while some of the areas of weakness weakened.
He placed the United States in the stronger category. But the company had expected to see growth in China and Europe this year. Instead, both regions have turned negative.
As a result, Emerson sees revenue and orders in the fourth quarter of its fiscal year, which ends in September, at the lower end of their guidance.
Despite weaker sales, management credited execution as the reason why earnings will be at the upper end of its guide.
Emerson also cited strength in its power, liquefied natural gas, and life sciences end , some imvement — but not strength — in factory automation, and weakness in bulk chemicals and automotive.
It's been a year of haves and have-nots for the industrials, with companies heavily tied to data center construction, electrification, power generation, and aerospace largely outperforming the rest of the sector.
These themes have carried the sector, and we've seen this play out in the portfolio through our gains in Eaton and GE Vernova , disappointment with the stock performance of Dover despite the company's double-digit earnings growth, and stocks stuck in spin-purgatory: Honeywell and DuPont .
We're still banking on the market coming to realize the value of the latter three, and an upbeat presentation by DuPont management at its investor day on Thursday could be the start for that one.
Up next: There are no major earnings reports after the closing bell on Tuesday. General Mills reports before the opening bell on Wednesday.
On the data side, we'll see weekly mortgage applications, and monthly housing starts and building permits.
The main event of the day will be the conclusion of the Fed's two-day policy meeting and its highly anticipated interest rate decision. The policy decision is at 2 p.m.
ET, and Powell's press conference begins 30 minutes later.
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