Traders work on the floor of the New York Stock Exchange (NYSE) in New York, United States, December 3, 2021. REUTERS / Brendan McDermid

Dec. 13 (Reuters) – US stocks were expected to rise on Monday, driven by gains from Apple which approached $ 3 trillion in market cap, as investors braced for a Federal Reserve meeting later this week, where it will likely signal a faster decline in monetary stimulus.

Shares of Apple Inc (AAPL.O) rose 1.4% in pre-market trading after JP Morgan raised its price target for iPhone maker shares to the highest on Wall Street. It was on the cusp of becoming the first company in the world to achieve $ 3 trillion in market value.

“When you see big companies like (Apple) doing well, it basically means people gravitate towards quality. Large companies that are very profitable, have very strong cash flow are really seen as a safe haven in a lot of cases, ”said Randy Frederick, Managing Director of Trading and Derivatives at Charles Schwab.

Other tech and communications stocks including Meta Platforms Inc (FB.O), Microsoft Corp (MSFT.O), Netflix Inc (NFLX.O) and Alphabet Inc (GOOGL.O) also gained 0.2%. and 0.7%.

Major Wall Street indices recovered most of their declines from late November after the detection of the new Omicron variant of the coronavirus, with the S&P 500 Index (.SPX) hitting an all-time high at the close on Friday.

Market participants bought shares of mega-cap growth companies, as well as numerous industry indicators and value-driven stocks, with many analysts indicating investors were buying the downside after the sell-off caused by concerns about the market. Omicron.

The Fed’s policy decision still remains a major event for the markets, with high bets that the US central bank will point to a faster reduction in asset purchases and an earlier start to the interest rate hike.

A Reuters poll of economists predicts the central bank will hike key interest rates near zero to 0.25-0.50% in the third quarter of next year, followed by another in the fourth quarter.

Positive updates on vaccines and antibody cocktails to combat the new variant, along with a recent reading on inflation that was in line with consensus, also kept sentiment afloat.

However, travel-related stocks fell on Monday after at least one patient died in the UK after contracting the Omicron variant of the coronavirus. Read more

Shares of Carnival Corp (CCL.N) and American Airlines (AAL.O) fell more than 1% each, leading to declines among cruise lines and airlines.

“The big unknown remains the Omicron variant and we don’t yet know how that might affect the markets and the economy, but as long as that uncertainty exists the volatility is likely to stay higher,” Frederick said.

As of 8:14 a.m. ET, Dow e-minis were up 21 points, or 0.06%, S&P 500 e-minis were up 10 points, or 0.21%, and Nasdaq e-minis 100 were up 63.5 points, or 0.39%.

Pfizer Inc (PFE.N) rose 1.3% as it agreed to acquire Arena Pharmaceuticals (ARNA.O) in a $ 6.7 billion all-cash deal. Arena shares jumped 90.4%. Read more

Reporting by Shreyashi Sanyal and Bansari Mayur Kamdar in Bangalore; Editing by Maju Samuel

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