Investors Anticipate Fed's Impact on Stocks and Bonds.

Investors are buying call options as they prepare for the Federal Reserve's decision that will determine the direction of equities for the rest of the year. The central bank is expected to pause its tightening on Wednesday for the first time in 15 months, but a resilient economy could push officials to hike again as soon as next month or keep borrowing costs elevated for longer. Investors are using calls to capture the upside if the bull market proves resilient while still remaining defensive because they're wary of what the Fed might signal this week about its policy path.