US inflation cools, jobs data disappoints, raising stakes for Fed’s policy trajectory as concerns of a US recession amid Trump's tariff policy grows louder.
While the S&P 500 flirted with its correction territory after today's fall, the tech-heavy Nasdaq Composite is already sitting in that zone after sliding more than 10% from its peak.
Global markets came under the fire amid broad-based selloff due to the Fed's disappointing 2025 dot-plot.
The Fed’s 25-bps rate cut aligned with market expectations, but stubbornly high inflation has prompted a more cautious approach. The central bank has raised its inflation projections and scaled back expectations for rate cuts in 2025 as it waits for greater clarity on price pressures and policy changes.
The US inflation has eased of late, but is still too high for comfort for the US Federal Reserve to start cutting policy interest rates. Jerome Powell made it clear that the rates won't be cut until there's confidence that the inflation is falling towards 2%.
From China's hopes of the EU lowering high tariffs on Chinese EVs to its central bank's support for the property sector, here's a look at some of the major developments from across the world.
S&P 500 tops 5,400 for the first time in history, dollar slides, US bonds end lower despite a hawkish commentary from the US Fed.
Fed Reserve Chief Jerome Powell announces key decision on rate hikes after a 2-day meeting of the US Federal Reserve. Watch!
Weakening retail sales and slowing manufacturing indices may be leading indicators of a possible recession. However, the Fed could continue to hike rates well into the next year to prevent the inflation from getting entrenched.
Swap traders betting on Fed policy are now leaning toward a 50 basis-point hike in September as more likely than a 75 basis-point move, following weak US economic data earlier on Friday.
“The worst fear in the market is that the war not only intensifies in Ukraine but spreads outside the border of Ukraine,'' said Steve Englander, Global Head of G10 Fx Research & North America Strategy, Standard Chartered Bank.
The money flow from US bonds into equities to continue for some more time, says Nick Parsons, Head of Research, UK & Europe, National Australia Bank.
Rajesh Kothari, Managing Director of AlfAccurate Advisors says Indian companies catering to the international markets like some pharma, auto ancillary and IT stocks will make a great buy as their valuations are very reasonable.
The Indian rupee has opened marginally lower at 66.72 a dollar on Tuesday compared to 66.61 a dollar in previous session.
So far, India has been beneficiary of the FII inflows into emerging markets and the moment they show signs of drying up, our market falters, says Ajay Bagga.
Ian Hui, global market strategist at JP Morgan Asset Management expects volatility for emerging markets post Fed rate hike.
Reliance Industries, Lupin, Tata Motors, HUL and ONGC were top gainers on the Sensex, up more than 2 percent followed by HDFC with 1.6 percent gain. ICICI Bank, Wipro and NTPC fell more than 1 percent.
Arvind Sanger of Geosphere Capital expects FM to make commitments towards handling structural challenges with regards to power shortages and banking.
The Fed is widely expected to hike rates for the first time in nine years in September. Ninety-two percent of the participants in CNBC's Fed Survey expect the central bank to begin raising rates this year,
Hans Goetti of Banque Internationale is of the view that Fed will drop the word 'patient' but the rate hikes will start only by June.
US markets closed flat ahead of the FOMC meet that begins today. The Fed is expected to wrap up its third round of bond buying. Meanwhile, Asian markets trade cautious.
Ken Goldstein, economist, The Conference Board said he would be surprised if Fed did not announce tapering programme before Bernanke leaves office and new chief takes over.
Yogesh Radke, head-quantative research, Edelweiss Securities sees Hexaware Technologies as a good play on back of the open offer and one can expect a 10 percent gain from a three month timeframe.
Although there is some nervousness about what the Fed is going to do, the US stock market seems very complacent, says Tim Ghriskey, Chief Investment Officer, Solaris Asset Management.
The US Federal Reserve's meeting later this week will top all other major events and data in Asia. All eyes will be on the US central bank's decision on scaling back of its monthly bond buying programme.