US STOCKS-Tech rally lifts S&P 500 and Nasdaq as Fed rate cut bets grow

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Indexes up: Dow 0.03%, S&P 500 0.37%, Nasdaq 0.85%

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Bitcoin stabilizes following massive losses

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Warner Bros rises on reports of offer from Netflix

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Boeing (BA) rises, expects higher deliveries of jets in 2026

(Updates with opening prices, analyst comments)

By Johann M Cherian and Pranav Kashyap

Dec 2 (Reuters) -

The S&P 500 and the Nasdaq were higher on Tuesday, lifted by tech shares, as growing bets on interest rate cuts offset caution ahead of key inflation data later this week.

The information technology sector led the market with a roughly 1.4% advance, driven by Nvidia's (NVDA) 3% rise to a more-than-one-week high and a 5% jump in Dell Technologies.

The rebound followed a sour start to December, when all three major indexes snapped a week-long winning streak on Monday under pressure from rising Treasury yields and a sharp selloff in crypto-linked shares.

Recent data has pointed to a gradually cooling economy, reinforcing bets on a Federal Reserve rate cut at next week's meeting.

The Fed is really torn between the public pressure to reduce rates versus the actual reality of the economy, said Peter Andersen, founder of Andersen Capital Management.

"Even though there are some pockets of weakness, in general the trend is strong and so I don't think lower rates are warranted at this point."

Policymakers remain largely split on the path ahead for interest rates, but a run of dovish remarks from key voting members in recent weeks has traders now betting on an 87.4% chance of a 25-basis-point cut next week - nearly double the odds seen a month ago, according to the CME Group's FedWatch Tool.

Investor focus has swung to Friday's release of the Personal Consumption Expenditures (PCE) Index, the Fed's preferred inflation gauge, which could sharpen expectations for the central bank's policy call next week.

Markets were also keenly watching who may succeed Fed Chair Jerome Powell when his term ends next year, with reports suggesting White House economic advisor Kevin Hassett is a top contender. The decision is expected before Christmas.

At 09:45 a.m. ET, the Dow Jones Industrial Average rose 15.72 points, or 0.03%, to 47,304.31, the S&P 500 gained 25.23 points, or 0.37%, to 6,837.86 and the Nasdaq Composite gained 197.84 points, or 0.85%, to 23,473.97.

Boeing (BA) jumped 6% after the planemaker said higher deliveries will be a key driver of positive cash flow next year.

Warner Bros Discovery rose 1% after reports said that it received a second round of bids, including an offer from Netflix.

Crypto stocks including Strategy and Coinbase rose 4.2% and 2.4%, respectively, as bitcoin prices showed signs of stabilizing after its largest dollar loss since May 2021 in the previous session.

Federal Reserve Vice Chair for Supervision Michelle Bowman is expected to testify before the House Financial Services Committee on Tuesday in a hearing on oversight of financial regulators.

On the geopolitical front, U.S. special envoy Steve Witkoff and U.S. President Donald Trump's son-in-law Jared Kushner are expected to meet Russian President Vladimir Putin for talks on a possible way to end the war in Ukraine.

Declining issues outnumbered advancers by a 1.07-to-1 ratio on the NYSE, while advancing issues outnumbered decliners by a 1.25-to-1 ratio on the Nasdaq.

The S&P 500 posted seven new 52-week highs and two new lows, while the Nasdaq Composite recorded 37 new highs and 32 new lows. (Reporting by Johann M Cherian and Pranav Kashyap in Bengaluru; Editing by Tasim Zahid and Shinjini Ganguli)