“For the time being the Fed remains in a holding pattern as it waits for uncertainty to clear,” said Ashish Shah, chief investment officer of public investing at Goldman Sachs Asset Management.
Traders also continue to assess a tough stance from President Donald Trump on China, and a steep slide in Alphabet shares after Apple executive Eddy Cue said the iPhone maker was exploring adding AI search to its browser.
On the trade front, China’s Vice Premier He Lifeng is set to travel to Switzerland this weekend for meetings with US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. However, Trump on Wednesday said he’s unwilling to preemptively lower tariffs on China in order to unlock more substantive negotiations with Beijing on trade.
“The meeting is expected to begin to de-escalate the pretensions and eventually lead to trade and tariff negotiations,” said Ivan Feinseth, chief investment officer at Tigress Financial Partners. “US/China trade negotiation progress will be the market’s momentum driver.”
Apple is “actively looking at” reshaping the Safari web browser on its devices to focus on AI-powered search engines, according to Cue, the company’s senior vice president of services who made the disclosure Wednesday during his testimony in the US Justice Department’s lawsuit against Alphabet. Shares of the iPhone maker traded down 2.4 per cent.
Among other individual-stock news, Disney gained 10 per cent after posting fiscal second-quarter results that beat estimates and raising its full-year outlook. Uber Technologies Inc. fell 2 per cent after the company reported weaker-than-expected gross bookings, stoking concerns about a potential consumer pullback amid souring economic sentiment. Steven Madden Ltd. withdrew its sales and profit outlook for the year, citing trade tensions stemming from US President Donald Trump’s ongoing tariff battle.
WeightWatchers, known for its diet programs once endorsed by celebrities including Oprah Winfrey, filed for bankruptcy after struggling to compete with weight-loss drugs like Ozempic.
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Meanwhile, the Chinese government also announced broad measures aimed at stabilising markets, encouraging tech innovation and supporting small businesses.
Data from Bespoke Research showed that even though stocks’ full-day performance on Fed days has been mixed, one thing has been extremely consistent — the trend of late-day selling. The S&P 500 averaged a 0.49 per cent decline in the final hour across the past ten Fed meetings, including a decline in the last hour of the last eight, Bespoke said.
Dennis DeBusschere of 22V Research, however, said the bar seems low for the Fed Chair to appear more dovish than expected.
“Powell just stating the facts on the recent inflation data and repeating over and over that the Fed will react to tariff impacts on inflation and growth as they happen, might be a dovish relief for investors,” DeBusschere said.
Outside US, geopolitics remained tenuous. Pakistan said it reserves the right to retaliate after India launched targeted strikes, signaling a potential further escalation in hostilities between the nuclear-armed rivals. Meanwhile, Russia and Ukraine continued air strikes against each other’s capitals overnight, including an attack that killed two people in Kyiv.
Bloomberg
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