Volatility is looming in markets as investors swing between hopes for a sharp 0.5% rate cut from the Federal Reserve and concerns about recession risks.
Wall Street struggles to stay afloat on Tuesdayas investors braced for an upcoming inflation report seen as crucial in determining the size of the first US interest rate cut in years.
The benchmark S&P 500 (+0.6%) and the tech-dominated Nasdaq Composite (+0.5%) are holding green, while the Dow Jones Industrial Average (^DJI) is down around 0.3%.
The moves follow Monday’s strong rally, which saw major indexes rise more than 1% as investors seized buying opportunities after the recent drop. Volatility is looming in markets as investors swing between hopes for a sharp 0.5% rate cut by the Federal Reserve and concerns about recession risks.
Wall Street in countdown
The countdown is on for the August consumer inflation reading, due on Wednesday, which could be decisive for rate cut expectations after the monthly jobs report left the market in uncertainty.
With the Fed’s policy decision just days away, investors are still unsure whether a 25- or 50-basis-point cut is in the offing. Thursday’s CPI update and wholesale inflation reading are the last two inflation gauges before policymakers meet on Sept. 17.
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Meanwhile, Apple (AAPL) shares fell slightly after the company lost an EU court battle over a $14 billion tax bill, a day after the iPhone 16 launch disappointed on the AI front. Elsewhere in tech, Oracle (ORCL) shares rose about 10% in early trading after beating earnings estimates, thanks to demand for cloud services.
Source: Ambito
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