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Major indices fall due to FOMC caution... Tesla and Nvidia down [New York Stock Market Briefing]
Summary
- The New York stock market reported that major indices fell amid caution ahead of the FOMC meeting results.
- Investors are placing more weight on interest rate freeze rather than the possibility of rate cuts within the year.
- The continued decline of Big Tech stocks such as Tesla and Nvidia is adding pressure to investor sentiment.
The New York stock market fell as caution was triggered ahead of the Federal Reserve's (Fed) benchmark interest rate decision.
On the 18th (local time), the Dow Jones 30 Industrial Average closed at 41,581.31, down 260.32 points (-0.62%) from the previous trading day on the New York Stock Exchange.
The Standard & Poor's (S&P) 500 index closed at 5,614.66, down 60.46 points (-1.07%), while the tech-heavy Nasdaq index finished at 17,504.12, down 304.54 points (-1.71%).
As the Fed began its Federal Open Market Committee (FOMC) schedule today and will announce the meeting results on the afternoon of the 19th, investors were cautious about continuing additional buying as they waited to see how the Fed would respond to recession concerns raised both on and off Wall Street.
While Wall Street experts generally expect the Fed to cut interest rates twice this year, according to CME's FedWatch, the futures market sees a 99% probability that the Fed will keep rates unchanged.
Continued market anxiety surrounding Trump's tariff policies and geopolitical risks also negatively affected the stock market. In particular, there are concerns that the Trump administration's tariff policies could stimulate inflation and trigger a recession. The U.S. import price index for February announced today rose 0.4% from the previous month, exceeding market forecasts.
News that the Israeli military resumed large-scale attacks on the Palestinian Gaza Strip today also heightened concerns about geopolitical risks in the Middle East.
The steep decline in Big Tech stocks also weighed on overall investor sentiment. All of the 'Magnificent 7,' referring to seven giant tech companies, declined.
Tesla plunged 5.3% today as expectations for intensified competition in the electric vehicle market grew following Chinese BYD's announcement of an ultra-fast charging system. Nvidia's stock fell 3.4% as the artificial intelligence (AI) conference 'GTC 2025' hosted by Nvidia opened today. Nvidia unveiled its new AI chip 'Vera Rubin' today, but the market's response was cold.
Other AI and semiconductor sector leaders such as Palantir (-3.96%) and Broadcom (-2.99%) also fell.
Jung-dong Noh, Hankyung.com reporter dong2@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
