With the impending start of a crucial US Federal Reserve meeting, the global anticipation has seen a significant downturn in the American stock market. The S&P 500 index experienced a 0.5% decrease, while the Nasdaq Composite, known for its focus on technology, saw a decline of around 0.2%, both retracting from their record highs. The Dow Jones Industrial Average took a particularly hard hit, plummeting by over 350 points, approximately 0.9%.
Investors find themselves at a crossroads, grappling with an economic forecast that swings between being scorching hot and unexpectedly icy. The recent economic data, offering a mixed bag of results, has heightened uncertainty surrounding the likelihood of multiple interest rate cuts in 2024, a projection made by the Fed back in March. Presently, most investors have revised their expectations to foresee just a single rate cut by the end of the year.
This pivotal two-day meeting on monetary policy looms large, with expectations that it will conclude with lending rates remaining at their highest levels in the past twenty years. All eyes are peeled for any indications that changes, possibly in September or November, might signal the onset of rate reductions. The imminent release of consumer inflation data for May on Wednesday will play a crucial role in shaping the Fed’s future decisions.
Apple stole the spotlight at the individual company level, with its shares surging by 3% following a significant loss in the previous session, driven by the unveiling of its latest breakthrough in artificial intelligence. Conversely, pharmaceutical company Eli Lilly witnessed a substantial rise in its shares after its experimental Alzheimer’s treatment received unanimous backing during an evaluation by an FDA advisory panel.
At the time of writing, the price of Bitcoin stood at US$66,910.12, reflecting a 3.9% drop in the past 24 hours.
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