01:30 PM EDT, 09/18/2024 (MT Newswires) -- US equity indexes advanced in choppy trading and volatility jumped ahead of the Federal Reserve's monetary policy announcements later on Wednesday.

The S&P 500 index rose 0.1% to 5,640.2, with the Nasdaq Composite up 0.1% to 17,644.2 and the Dow Jones Industrial Average 0.1% higher at 41,645.49 in midday trading Wednesday. Energy led the gainers while utilities were among the decliners intraday, with moderate moves on both sides.

The CBOE Volatility Index, also known as the fear gauge, jumped 5.2% to 18.52 intraday.

The Federal Open Market Committee statement and Summary of Economic Projections are scheduled to be released at 2:00 pm ET, followed by Federal Reserve Chair Jerome Powell's press conference at 2:30 pm ET. The policy announcement will be FOMC's last before the Nov. 5 presidential elections.

According to data compiled by the CME Group from interest-rate traders, the probability of a 50 basis-point cut stood at 55% on Wednesday afternoon. The remaining 45% likelihood was a 25 basis-point drop, implying the Fed is all set to deliver its first rate cut. The Fed has been on the sidelines for 13 months and if a rate cut comes about it will be the central bank's first since March 2020, a note from Stifel said.

The Fed will reduce its target rate by 25 basis points while issuing a dovish message via the so-called dot plot and Powell's discourse at the press conference, a note from Macquarie said. "If we are wrong, and the Fed cuts by 50bps, we expect that the 'dovish' implication will be offset by guidance (from Powell) for 25bps rate cuts for the last two FOMC meetings of the year."

"History is ambiguous toward the size of a first cut in an easing cycle, but when they've gone big out of the gates it has typically been because of something really bad and ugly happening, like the [Great Financial Crisis] or dot-com shock," Derek Holt, head of capital market economics at Scotiabank, said in a note.

Most Treasury yields rose, with the 10-year yield up 3.7 basis points to 3.68%, and the two-year rate was 4.8 basis points higher at 3.64%.

The US dollar depreciated 0.3% against the Japanese yen to 141.90.

In economic news, August housing starts were up 9.6% from the previous month to a 1.356 million annual rate, above expectations compiled by Bloomberg for a 1.32 million rate after a decrease to a 1.237 million pace in July. Building permits rose 4.9% to a 1.475 million rate in August, above the 1.41 million rate expected and following a drop to a 1.406 million rate in July. Homes permitted but not started increased, implying an optimistic outlook for housing starts next month.

In company news, Wolfe Research downgraded ResMed ( RMD ) to underperform from a peer-perform stock rating, with a price target of $180. Shares of the company fell 5.7% intraday, the worst performer on the S&P 500.

West Texas Intermediate crude oil futures fell 0.8% to $70.61 a barrel.

Gold rose 0.3% to $2,600.50 an ounce, while silver declined 0.7% to $30.76.