Investing.com — Wall Street fell Wednesday after new diplomatic setbacks between the United States and Iran. Investors were also cautious as they prepared for what is expected to be one of the busiest trading days of the year so far.
In addition to developments in the ongoing Middle East conflict, market participants will receive a key interest rate decision from the Federal Reserve later today, followed by quarterly results from no fewer than four members of the Magnificent 7 club after the closing bell.
At 12:38 p.m. ET (16:38 GMT), the benchmark index was down 0.3% at 7,117.31 points, the technology index slipped 0.5% to 24,553.70 points and the blue chip stocks lost 0.7% to 48,813.65 points.
“Markets are navigating a perfect storm of uncertainty: a Fed caught between stubborn inflation risks and a fragile geopolitical backdrop, big tech facing time to make decisions on AI spending, and OPEC crumbling from within. The next 48 hours could set the tone for the weeks to come,” Lukman Otunuga, head of market research at FXTM, told Investing.com.
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The Fed should keep rates stable in the face of the deluge of central banks
An important week for central banks will intensify on Wednesday, when the Fed announces what is expected to be its final interest rate move under current Chairman Jerome Powell. The Federal Open Market Committee (FOMC) largely appears to be keeping its policy rate steady between 3.50% and 3.75%.
The Fed’s decision comes at a time when soaring oil prices due to the war in Iran have had their impact on consumer prices in the United States. Possible future inflationary pains, as well as a labor market that remains in a “low hiring, low fire” environment, have made the central bank’s job complicated.
“The Fed is expected to keep interest rates unchanged at Wednesday’s meeting. The message will likely reflect a greater focus on inflation, especially as oil prices remain elevated and have barely budged since the Fed’s last meeting in mid-March,” Chris Brigati, chief investment officer at SWBC,…
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