New York and Shanghai stocks watch who will be the next Fed chair

This week, the U.S. New York stock market (26–30) is expected to focus on the outcome of the Federal Open Market Committee (FOMC) meeting of the U.S. central bank (Fed) to be held on the 28th (local time), whether a nominee for the next Fed chair will be named, and Big Tech earnings.

Federal funds rate futures price a 97% probability that the benchmark rate will be left unchanged at this FOMC meeting. What the market is even more focused on is the next Fed chair. With BlackRock’s Rick Rieder, CIO for global fixed income, former Fed governor Kevin Warsh and Fed Governor Christopher Waller remaining as the final three candidates, prediction markets had Rieder moving into the top spot for nomination odds for the first time late last week.

This week, fourth-quarter results for Microsoft (MS), Tesla, Meta and Apple for last year will be released one after another. MS, Tesla and Meta report on the 28th, while Apple will disclose results on the 29th. The key question is whether Big Tech is still maintaining high profitability despite capital spending on AI infrastructure.

MS and Meta shares are down 16% and 17%, respectively, from their 52-week highs. Apple is also off 14%, and Tesla has slid more than 10%. Concerns that excessive AI capex could hurt core businesses are cited as a main backdrop for declines in MS, Meta and Tesla, while Apple is seen as facing worries it could fall behind in the AI era.

Shanghai stocks are expected to enter a full-fledged earnings-driven market as major listed companies roll out their full-year 2025 earnings guidance. With the Shanghai Composite having paused for breath after breaking above 4,100—its highest level in a decade—these corporate scorecards are likely to serve as a touchstone for gauging the resilience of the services sector and capital markets. Investors’ attention is focused on results from China’s semiconductor bellwether SMIC and battery maker CATL.

New York = Correspondent Park Shin-young nyusos@hankyung.com