Ahead of the US FOMC, a second day of simultaneous declines... Palantir plunges 12% [New York Stock Market Briefing]

The three major indices of the New York Stock Exchange closed with simultaneous declines for the second day ahead of the Federal Reserve's interest rate announcement. The stock market is adjusting as it awaits the results of tariff negotiations between the US and major countries.

On the 6th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 40,829.00, down 389.83 points (0.95%) from the previous session. The Standard & Poor's (S&P) 500 index fell 43.47 points (0.77%) to 5,606.91, and the tech-heavy Nasdaq composite index dropped 154.58 points (0.87%) to close at 17,689.66.

There was no significant progress in the tariff negotiations. US Treasury Secretary Scott Besant testified at a House Appropriations Committee hearing, stating that trade negotiations are underway with 17 major trading countries, excluding China, and that "we may announce trade agreements with some of our largest trading partners as early as this week."

US President Donald Trump told the press before a summit with Canadian Prime Minister Mark Carney at the White House that "China wants to negotiate and meet," and "we will meet with China at the appropriate time."

Trump also stated that trade negotiations with major countries could be concluded at some point within the next two weeks.

There were also foreign media reports that the US and the UK are preparing to sign a trade agreement aiming for an agreement this week.

According to the reports, the US plans to set quotas (import quotas) on British cars and steel to exempt them from a 25% tariff. This means that only the specified quantities will be free from tariff burdens.

Trump announced the previous day that he would announce itemized tariffs on pharmaceuticals within the next two weeks. He has repeatedly stated that he would introduce itemized tariffs on pharmaceuticals and semiconductors. While the imposition of pharmaceutical tariffs is not new, the specific figures for each item are information that the market is paying attention to.

The US trade deficit in March reached a record high. This is attributed to a surge in pre-orders ahead of large-scale tariff policies.

According to the US Department of Commerce, the trade deficit in March was $140.5 billion. This is a 14% increase from the previous month and larger than the market's expected deficit of $137 billion.

By sector, only energy and utilities rose. Utilities rose by more than 1%. In contrast, healthcare plummeted by nearly 3%.

Eli Lilly plunged 5.61%. This is attributed to the impact of President Trump's announcement of pharmaceutical tariffs. Merck and Amgen fell by nearly 5% and 4%, respectively. Pfizer also dropped by more than 3%.

The 'Magnificent 7' (M7), referring to seven giant tech companies, saw Amazon and Apple record slight gains, while the rest declined. Meta fell by 2%, and Tesla dropped by 1.75%.

US automaker Ford rose by more than 2%. This was due to the announcement of better-than-expected first-quarter results after the market closed the previous day.

Ford announced that its earnings per share (EPS) for the first quarter was $0.14, and revenue was $37.42 billion. Both exceeded market expectations.

In contrast, US AI defense contractor Palantir plunged 12%. Although Palantir also announced strong first-quarter results, Wall Street views that its stock price has already risen too much this year.

Gabriela Borges, an analyst at Goldman Sachs, stated, "Palantir is in a favorable position to continue its top-level growth in the future," but only raised the target price from $80 to $90.

As the Federal Open Market Committee (FOMC) meeting is held over two days starting today, the market expects interest rates to remain unchanged. Market participants are paying more attention to what Federal Reserve Chairman Jerome Powell will say at the press conference.

According to the Chicago Mercantile Exchange (CME) FedWatch Tool, the probability of the Fed holding the benchmark interest rate steady in June is reflected at 68.1%. The 'June hold' theory has clearly taken the lead.

The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) rose 1.12 points (4.74%) to 24.76 from the previous session.

Jong-seok Ko, Hankyung.com reporter jsk@hankyung.com