Market sentiment turned cautious on Wednesday as investors digested the possibility of a major tech giant’s breakup, while awaiting further guidance from the Federal Reserve on the economy’s trajectory. The Dow Jones Industrial Average, S&P 500, and Nasdaq 100 futures all traded marginally lower, erasing earlier premarket losses. The recent volatility in the markets stems from the intense debate surrounding the state of the economy, following the Fed’s surprise 50-basis-point rate cut. The move has sparked concerns that the central bank may be aware of underlying risks that the market is not. As a result, investors are now pondering the likelihood of a “no landing” scenario, where the economy continues to grow and inflationary pressures resurface. The release of the Fed’s September meeting minutes later today will be closely scrutinized, particularly with regards to the dissenting vote on the rate cut. In other news, the Department of Justice is reportedly considering a forced divestiture of key Google businesses to address its dominant market position. Alphabet shares slipped in premarket trading, despite a broader tech sector rebound on Tuesday. Meanwhile, Taiwan-based chipmaker TSMC reported quarterly sales that exceeded Wall Street expectations, driven by robust demand for artificial intelligence applications. TSMC shares edged higher, while its customer Nvidia saw its stock rise over 1%, building on previous gains.
Leave a Reply