Market Mood Cautious Ahead of Fed Decision and Big Tech Earnings
The Nasdaq 100 futures rose 0.4% on Wednesday, driven by upbeat orders from ASML, a key player in the AI chip industry. This boost came as a welcome respite for chip stocks, which had been struggling earlier in the week. However, the broader market mood remained subdued, with investors exercising caution ahead of the Federal Reserve’s rate decision and the first batch of Big Tech earnings.
Fed Policy Verdict Looms Large
The Fed’s policy verdict is expected to be a major market mover, with investors eagerly awaiting answers to two key questions: How much further will the Fed cut rates, and has the central bank changed its stance in light of President Trump’s early tariff moves? While the Fed is expected to stand pat on interest rates, the press conference by Fed Chair Jerome Powell will be closely watched for any hints on future policy direction.
Tech Stocks Get a Boost
ASML’s surprise rise in bookings gave a much-needed boost to tech stocks, with shares of the company surging 7% in pre-market trading. Peers like Applied Materials also made gains, as investors began to regain confidence in the sector. Meanwhile, Alibaba’s release of a new AI model, which it claims is better than DeepSeek’s rival to ChatGPT, sent its shares higher.
Big Tech Earnings in Focus
The spotlight is now on the guidance in Meta and Microsoft’s quarterly results, due after the bell, for reassurance that Big Tech’s heavy AI spending will pay off in growth. Tesla rounds out Wednesday’s megacap earnings, with Wall Street watching for a new catalyst to jump-start the stock.
Trump Media & Technology Group Expands into Financial Services
Trump Media & Technology Group shares rose nearly 15% in pre-market trading after the company announced it would be expanding into financial services. The operator of Truth Social will now be launching a financial services and fintech brand dubbed “Truth.Fi,” with a $250 million investment in customized separately managed accounts, exchange-traded funds, and cryptocurrencies.
Apple Rating Cut Ahead of Earnings
Oppenheimer has joined its peers at Loop Capital and Jefferies in cutting its rating on shares of Apple ahead of the company’s fiscal first quarter results. The firm cited slowing iPhone sales and a lack of AI innovation as reasons for the downgrade.
Economic Data and Earnings Ahead
Today’s economic data includes MBA Mortgage Applications, while the FOMC rate decision is also expected. Earnings reports are due from Tesla, Meta, Microsoft, ADP, ASML, General Dynamics, IBM, Nasdaq, Progressive, ServiceNow, T-Mobile, and V.F. Corporation.
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