- Stocks slipped as traders eyed the conclusion of the Fed's policy meeting.
- Markets are widely expecting the Fed to keep interest rates unchanged.
- The outlook for rate cuts this year continues to sour, with traders pricing in just one or two cuts by December.
US stocks were mostly lower on Wednesday as traders waited for the Federal Reserve to announce its next move on interest rates.
Central bankers are concluding their Federal Open Markets Committee meeting this afternoon and will deliver guidance on the path of rate cuts later this year. Markets are pricing in a near-100% chance the Fed will hold interest rates steady for the month, according to the CME FedWatch tool.
"It is almost certain that we will see monetary policy held as it is today," Richard Flynn, the managing director of Charles Schwab UK, said in a note on Wednesday. "Central bankers have made it clear that interest rates will not be lowered until there is substantial evidence that inflation is trending lower, and robust recent economic data has failed to provide it."
Investors have also dialed back their outlook for rate cuts throughout the year. Traders are now pricing in a 41% chance the Fed will only cut interest rates once by December, down from six to seven rate cuts priced in at the start of the year.
"Since the beginning of the year, it has become routine to push back the rate cut forecast and reduce the number of rate cuts from three to 1-2. At Wednesday's meeting, market watchers expect Powell to formally confirm this shift from the FOMC, which had previously forecast three rate cuts this year," Alex Kuptsikevich, a senior market analyst at FxPro said in a note.
Here's where US indexes stood at the 9:30 a.m. opening bell on Wednesday:
- S&P 500: 5,028.37, down 0.15%
- Dow Jones Industrial Average: 37,881.13, up 0.17% (+57.62 points)
- Nasdaq Composite: 15,610.05, down 0.29%
Here's what else is going on:
- More CEOs are deciding that the stress, pressure, and loneliness are just not worth the money.
- Iran's economy is a total mess after decades of sanctions — and that offers a warning to Russia's economy.
In commodities, bonds, and crypto:
- West Texas Intermediate crude oil dropped 1.72% to $80.52 a barrel. Brent crude, the international benchmark, fell 1.56% to 84.98 a barrel.
- Gold edged lower to $2,295.76 an ounce.
- The 10-year Treasury yield dipped three basis points to 4.645%.
- Bitcoin dropped 5.72% to $57,778.