Latest news with #Fed-decision
Business Recorder
06-05-2025
- Business
- Business Recorder
Wall Street declines after Trump's latest tariff threats
Wall Street's main indexes fell on Tuesday after U.S. President Donald Trump's latest plans for pharma tariffs renewed worries of the impact of a trade war, while some downbeat corporate results also weighed on investor sentiment. Trump said late on Monday that he would announce pharma tariffs over the next two weeks, his latest action on levies that have roiled global financial markets over the past months. Eli Lilly and Merck slipped about 2.4% each, while Pfizer was down 1.7% after the news, which offset optimism around Trump's order aimed at reducing the approval time for pharmaceutical manufacturing plants. Tariff-driven uncertainty has led consumers, businesses and even the U.S. Federal Reserve to adopt a wait-and-watch mode as they struggle to navigate the tariffs and gauge their impact. Ford Motor was the latest to suspend its annual outlook on Monday, joining a host of companies that withdrew their forecasts in April. The carmaker's shares reversed premarket losses and were last up about 1% in choppy trading. 'The biggest thing that stands out (this earnings season) is that CEOs are concerned about the uncertainty that's coming out (of) Washington, D.C. with respect to global trade,' said Adam Sarhan, chief executive of 50 Park Investments. Wall St lower after Trump's fresh tariffs at start of Fed-decision week At 09:55 a.m. ET the Dow Jones Industrial Average fell 435.80 points, or 1.06%, to 40,783.03, the S&P 500 lost 61.98 points, or 1.10%, to 5,588.40, and the Nasdaq Composite lost 240.21 points, or 1.35%, to 17,604.03. Most S&P 500 sectors were trading in the red, with healthcare and info tech the biggest losers, down 1.4% and 1.7%, respectively. Data analytics firm Palantir's shares fell 13.5% to the bottom of the S&P 500 as investors were unimpressed by the company's modest revenue beat and in-line profit. The Fed starts its two-day meeting on Tuesday, with the central bank widely expected to stay put on interest rates. Comments from policymakers will be scrutinized for any clues hinting at where they stand on monetary policy easing this year. Traders see about 79 basis points of policy easing by the end of 2025, with the first cut coming in July, according to data compiled by LSEG. The Trump administration suggested last week that potential deals with trading partners were underway, but markets have seen no concrete results on that front. Wall Street closed lower on Monday, with the benchmark S&P 500 snapping a nine-session winning streak. Against the uncertain trade backdrop, businesses boosted imports of goods in March, pushing the country's trade deficit to a record high of $140.5 billion. DoorDash was down 7.5% after the meal delivery firm said it would buy Deliveroo in a deal valuing the British rival at about 2.9 billion pounds ($3.86 billion). The U.S. firm's quarterly revenue missed estimates, disappointing investors. Declining issues outnumbered advancers for a 3.03-to-1 ratio on the NYSE and a 3.31-to-1 ratio on the Nasdaq. The S&P 500 posted three new 52-week highs and six new lows, while the Nasdaq Composite recorded nine new highs and 56 new lows.
Straits Times
05-05-2025
- Business
- Straits Times
US stock rally cools after latest Trump tariff at start of Fed-decision week
Futures-options traders work at the New York Stock Exchange on April 30. PHOTO: REUTERS US stock rally cools after latest Trump tariff at start of Fed-decision week NEW YORK - The S&P 500 fell to snap its longest streak of gains in 20 years on May 5 as investors assessed US President Donald Trump's latest tariff announcement ahead of the Federal Reserve's monetary policy decision later this week. On May 4, Mr Trump announced a 100 per cent tariff on movies produced outside the US but provided no details on how such levies would be implemented. Stocks have been volatile since Mr Trump announced his first round of tariffs on April 2, with the S&P 500 initially dropping nearly 15 per cent, only to stabilise and climb for the last nine straight sessions through May 2, its longest streak since 2004. On May 5, Treasury Secretary Scott Bessent said Mr Trump's tariff, tax-cut and deregulation agenda would work together to drive long-term investment to the US, adding markets could overcome any short-term turbulence. 'Nine up days in the S&P 500 is hard to maintain,' said Mr Art Hogan, chief market strategist at B Riley Wealth in Boston. 'We are starting to price in that eventuality of deals being announced, but we're running out of daylight on that because every week that goes by that we don't start cutting deals we're doing economic damage.' The Dow Jones Industrial Average fell 98.60 points, or 0.24 per cent, to 41,218.83, the S&P 500 lost 36.29 points, or 0.64 per cent, to 5,650.38 and the Nasdaq Composite lost 133.49 points, or 0.74 per cent, to 17,844.24. The Dow also snapped a nine-session win streak, its longest since December 2023. Several movie and television production stocks fell sharply right after Mr Trump's announcement, but subsequently pared losses. Netflix fell 1.9 per cent to snap an 11-session winning streak, while lost 1.9 per cent and Paramount Global was 1.6 per cent lower. Energy, down 2 per cent, was the worst performer of the 11 major S&P sectors, after Opec+ decided to speed up its output hikes, causing concerns about more supply as demand remains uncertain. Class B shares of Berkshire Hathaway stumbled 5.1 per cent after Mr Warren Buffett said he will step down as CEO of the conglomerate. On the economic front, the Institute for Supply Management survey showed the services sector picked up growth in April, while a measure of prices paid by businesses for materials and services raced to the highest level in more than two years, indicating tariffs were causing inflation pressures to build. Investors will closely eye the Fed's policy announcement on May 7, in which the central bank is largely expected to keep interest rates unchanged. Commentary from Fed Chair Jerome Powell will be scrutinized for signs of when the Fed will adjust monetary policy. Markets are pricing in about 75 basis points of rate cuts by the Fed for 2025, with the first easing of at least 25 basis points likely at the central bank's July meeting, according to LSEG data. Investors are also concerned about how tariffs may affect corporate profitability. Tyson Foods tumbled 7.7 per cent after the meat packer missed quarterly revenue expectations. However, Skechers surged 24.3 per cent after the footwear maker agreed to be taken private by 3G Capital in a US$9.4 billion (S$12 billion) deal. Declining issues outnumbered advancers by a 1.88-to-1 ratio on the NYSE and by a 1.79-to-1 ratio on the Nasdaq. The S&P 500 posted nine new 52-week highs and three new lows, while the Nasdaq Composite recorded 53 new highs and 57 new lows. Volume on US exchanges was 13.67 billion shares, compared with the 18.68 billion average for the full session over the last 20 trading days. REUTERS More on this Topic Trump tariffs' impact on Singapore: The good news and the bad Join ST's Telegram channel and get the latest breaking news delivered to you.
Yahoo
20-03-2025
- Business
- Yahoo
Powell Fuels Rare Rally in Both Stocks, Bonds With Soothing Tone
(Bloomberg) -- Recession odds, while higher, aren't alarming. Inflation, while still sticky, isn't worth fretting over. And trade policy? It'll become clear when it becomes clear. In short, Federal Reserve Chair Jerome Powell said, there's no reason to do anything with the current path of monetary policy. Despite Cost-Cutting Moves, Trump Plans to Remake DC in His Style Amtrak CEO Departs Amid Threats of a Transit Funding Pullback NYC Plans for Flood Protection Without Federal Funds The Scary Thing About the Wildfire That Was Stopped A Malibu Model for Residents on the Fire Frontlines For battered stock bulls, the message was a relief. The S&P 500 Index spiked higher by as much as 1.8% before fading into the close. Its 1.1% gain still marked the best Fed-decision day since July. The tech-heavy Nasdaq 100 Index jumped more than 2% at its highest, with Apple Inc., Microsoft Corp. and Nvidia Corp. all arresting, at least temporarily, drops that left them lower for the year. Even bond investors — who often have the opposite reaction to Fed messaging than stock investors — were encouraged by Powell's stay-the-course tone. They bid up prices, pushing benchmark 10-year yields down for a third day in a row. It was the first time in eight months both assets rose in tandem after a Fed decision. The Fed left interest rates unchanged, as was widely expected, and signaled officials still see two cuts this year while lowering their forecast for economic growth and raising their outlook for inflation. That's a combination that on its face smacks a bit of stagflation, not a recipe for a risk-on rally, but Powell's comments at the press conference afterward eased those concerns on Wall Street. There, the Fed chair suggested that any inflation from President Donald Trump's tariffs may be a temporary concern. And while economic surveys have started to show consumers and businesses increasingly concerned about a slowdown in growth, hard data — from manufacturing to goods orders and services — remain robust, Powell said. 'Traders see through stagflation concerns because officials are still easing policy,' said Scott Colyer chief executive at Advisors Asset Management via phone. 'The Fed is signaling to the market that central bankers are getting ahead of any potential liquidity concerns that may arise later down the road if growth takes a hit from tariffs and unemployment rises.' The stock rally comes after a brutal month that saw $4 trillion in value wiped from the S&P 500 during a 10% rout. Growing concern that Trump's uncertain policies would tip the economy into a recession while stoking inflation battered risk assets and sparked a rally into the safety of Treasuries. The S&P 500 entered the meeting down 6% from the Fed's January meeting, the largest drop between gatherings since the middle of 2022, according to Bespoke Investment. Even after the rally, there remains anxiety over how much downside may be left in store for stocks after the tech-heavy Nasdaq 100 entered a correction on March 7 and still remains nearly 11% off its Feb. 19 peak. 'The market is grasping. Any news that isn't dismal is considered good for stocks right now after the onslaught,' said Adam Sarhan, founder of 50 Park Investments. 'There's still a lot of technical damage after a steep leg down. Despite the rebound, this isn't a strong vote of confidence. We need to see bigger rallies that stick.' Rallies in the most speculative corners of the market led US stocks higher. A Goldman Sachs basket of unprofitable tech companies, which includes firms like Roku Inc. and Peloton Interactive Inc., soared almost 3%. The Russell 2000 Index jumped 1.6%, while the most shorted companies jumped 2.8%. 'Stocks can climb any wall of worry after being so oversold,' Ivan Feinseth, chief investment officer at Tigress Financial Partners, said in a phone interview. 'The market will cling to any good news it can get.' While officials said 'uncertainty around the economic outlook has increased,' Powell made it clear that if data start to deteriorate, the Fed will act quickly to fulfill its mandate of maximizing employment and keeping inflation in check. 'The market's conclusion that the Fed is dovish is accurate in our view, but that dovishness is clearly conditional on further deterioration,' Garrett Melson, portfolio strategist at Natixis Advisors LLC. 'It should never have been a question that the Fed would pivot. They will, and their track record says as much.' The potential for inflation to be a lingering issue may be why the Fed is still forecasting just two rate cuts this year, even though policymakers expect higher unemployment and slower economic growth, according to the Summary of Economic Projections released Wednesday. Importantly, some market watchers said, the decision to slow the rate of reducing the Fed's Treasury holdings added to the risk-on mood. 'This is music to the market's ears,' Jamie Cox, managing partner at Harris Financial Group, said by phone. 'People were worried that tariffs would derail the Fed's rate-cut path. But by reducing the runoff of the Fed's balance sheet, that is still policy easing.' --With assistance from Ye Xie, Elena Popina and Norah Mulinda. 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Bloomberg
19-03-2025
- Business
- Bloomberg
Powell Reassures on Economy and Beaten Stock Bulls Jump Back In
Recession odds, while higher, aren't alarming. Inflation, while still sticky, isn't worth fretting over. And trade policy? It'll become clear when it becomes clear. In short, Federal Reserve Chair Jerome Powell said, there's no reason to do anything with the current path of monetary policy. For battered stock bulls, the message was a relief. The S&P 500 Index spiked higher by as much as 1.8% before fading into the close. Its 1.1% gain still marked the best Fed-decision day since July. The tech-heavy Nasdaq 100 Index jumped more than 2% at its highest, with Apple Inc., Microsoft Corp. and Nvidia Corp. all arresting, at least temporarily, drops that left them lower for the year.
