Investors are holding their breath as the Federal Reserve’s two-day meeting commences, and U.S. stocks slip in response. At 9:39 ET (13:39 GMT), the Dow Jones Industrial Average, S&P 500, and NASDAQ Composite all saw a decrease, with the Dow Jones dropping 173 points or 0.5%, the S&P 500 falling 0.4%, and the NASDAQ Composite declining by 0.2%.
The Federal Reserve will make a statement regarding interest rates tomorrow afternoon, and Fed Chair Jerome Powell will answer questions at a press conference. Investors will be closely monitoring the conference for any clues regarding the Fed’s plans leading up to the next meeting in June.
Futures traders are predicting a 0.25% rate increase tomorrow, followed by a pause in June while the Fed analyzes the effectiveness of its actions in curbing inflation.
An additional issue that could have a significant impact on the market over the next few weeks is the nation’s debt ceiling. According to Treasury Secretary Janet Yellen, the government is at risk of defaulting on June 1, based on tax receipts to date. The government has been navigating around the $31.4 trillion debt limit since January, but unless Congress raises or suspends the limit, the government will run out of opportunities to do so on the new date.
On May 9, President Joe Biden invited leaders in the Senate and House to a meeting at the White House. In other economic data this week, the markets will receive job opening data and factory orders. The monthly report on jobs, due out on Friday, is expected to be the most significant report.
Pfizer Inc. exceeded expectations in the first quarter, with shares up 1.4% on the back of strong demand for recently acquired products and pneumococcal vaccines. Uber Technologies Inc. shares rose 6.2% after the company predicted core earnings higher than estimates. Chegg Inc., a provider of educational services, saw shares plummet 48.8% due to fears that artificial intelligence chatbots would undermine its business.
Oil prices saw a drop, with Crude Oil WTI Futures falling 2.3% to $73.86 a barrel and Brent Oil Futures decreasing by 2.1% to $77.58 a barrel. Meanwhile, Gold Futures saw a 0.1% increase, bringing the value up to $1,995.
