Fed’s rate decision could unravel this bond-market recession bet

The stakes for investors have been running high ahead of a historic rate cut expected from the Federal Reserve on Wednesday.

The Dow Jones Industrial Average DJIA ended Monday at a record as stock-market bulls cheered the prospect of the Fed’s first rate cut in four years. Investors hope the central bank’s next moves could help erase some of the uncertainty gripping markets in recent weeks, while also potentially helping fortify a soft landing for the economy.