4:12pm: Nasdaq leads rally
US stocks finished Wednesday’s session on the front foot after the Federal Reserve held interest rates steady and signalled it intends to stay on course for two more rate cuts this year.
The tech-laden Nasdaq led the gains, up 1.4% at 17,750 points. The S&P 500 added 1.1% at 5,675 points while the Dow Jones was up 0.9% at 41,964 points.
"Overall, today’s meeting could help stocks and other risky assets to stage a short-term recovery," XTB research director Kathleen Brooks said. "However, we think that the Fed does not have the power to move markets in the medium term, because there are still lots of unknowns about the President Trump’s tariff policy."
3:45pm: More aggressive reduction ahead
Wells Fargo expects a more aggressive 75-basis-point reduction by year-end, arguing that an economic slowdown could push the Fed to prioritize employment over inflation, potentially triggering rate cuts by summer.
"We have a more dovish view of monetary policy in coming months than the collective FOMC," analysts acknowledged.
"If the economic slowdown that we forecast eventually leads the FOMC to place more weight on the 'full employment' objective of its dual mandate than on its 'price stability' objective, then we believe the Committee will ultimately conclude that lower rates are warranted and commence an easing cycle this summer," analysts wrote.
"The median dot in the dot plot continues to look for 50 bps of rate cuts this year. However, there are now more FOMC members who think that less than 50 bps of easing would be appropriate than members looking for more than 50 bps of rate cuts."
2:57pm: Fed decision 'no suprise'
It's no surprise that the Fed has kept target rates unchanged today, said Jeffrey Roach, Chief Economist for LPL Financial.
"The committee is in the midst of policy fog as they await the impact from upcoming tariffs. The updated projections are more downbeat and will place downside pressure on the dollar in the near term," Roach commented.
"Despite this month’s inflation data to have risks to the upside, we should expect core inflation to decelerate by the summer, in time for the Fed to cut in June."
2:08pm: Fed holds rates
The Federal Reserve kept interest rates unchanged for the second consecutive meeting and maintained its forecast for two rate cuts this year. However, it revised its outlook, expecting higher inflation (2.8% vs. 2.5%) and slower economic growth (1.7% vs. 2.1%).
The unemployment rate is projected to rise slightly to 4.4%. These adjustments come amid the Trump administration's new economic policies, including tariffs on China, Canada, Mexico, and key metals, with more duties expected soon.
1:28pm: Look to the dot plot
Once again, the Fed is expected to keep interest rates unchanged today, but policymakers will update their dot plot, along with growth and inflation forecasts, offering insights into where they may focus their efforts in a shifting economic landscape.
"Is the Fed worried about a renewed uptick in inflation due to the government’s hectic tariff policies? Is it more worried about the negative impact of the wide-ranging White House policies on employment and growth? Is it worried about the stock market selloff?" asks Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
"The dot plot will tell who is closer to the Fed’s mind and when we could expect a rate cut. A dovish stance could help slow the equity selloff and give a minor rebound to equities and the US dollar, while a cautious stance could sent the S&P500 back into the correction territory – meaning 10% or more lower than its February peak – and extend the scope for deeper losses for both US equities and the US dollar."
12:43pm: Fed decision nears
The Nasdaq is leading the major US stock indexes higher in midday trading, up 1%. The S&P 500 is following closely behind with a gain of 0.8%, while the Dow Jones is up 0.6%.
Stocks are advancing as investors await the Federal Reserve's policy decision, due later today. Investors are hoping for insights into the central bank's outlook on the economy and future interest rate path.
11:53am: Nvidia's 'clear roadmap'
Nvidia presented a "clear roadmap" at GTU Day 2, analysts at UBS believe, challenging concerns about slowing compute demand and scaling.
Three key points sparked discussion amongst analysts.
A slide comparing unit shipments to the top four U.S. cloud service providers (CSPs) for both Hopper and Blackwell raised eyebrows. The data suggested that these customers represented around 40% of total shipments last year. However, Nvidia clarified that the Blackwell figures reflected units "in process," essentially a backlog stretching through Q3.
This insight led to an updated UBS estimate of around 4.2 million units for Blackwell from Q1 to Q3, slightly above the analyst’s model of 3.8 million, reinforcing the analyst's $5.30 EPS forecast for the year, above the street consensus of $4.50.
The company revealed that Rubin and Rubin Ultra will ship in the second half of 2026 and 2027, aligning with the expected cadence but later than some investors had anticipated.
Nvidia also announced new switch solutions, Spectrum-X for Infiniband and Quantum-X for Ethernet, aimed at scale-out computing. While this raised concerns for Marvell (MRVL), analysts at UBS remain cautious, suggesting that demand for Nvidia's solutions may not be as strong as feared and could lead to increased transceiver growth, potentially offsetting any losses in optical DSP shipments.
"Overall, NVDA did a nice job laying out the roadmap and debunking the narrative that compute demand and scaling is seeing any slowdown," analysts concluded.
10:43am: Dollar rebounds
The US Dollar saw a slight rebound ahead of today's Federal Reserve interest rate decision.
"While markets widely expect the Fed to hold rates steady, investors will closely monitor Fed Chair Jerome Powell's economic projections," commneted Tito Iakopa, Commercial Director at FlowCommunity.
"His comments on the economic impact of President Donald Trump’s policies may also influence market sentiment in the weeks ahead. A dovish stance could exert selling pressure on the currency, while a more restrictive outlook would likely boost the greenback."
Meanwhile, US Treasury yields remained steady, with the 10-year note holding at around 4.3%.
"Higher expectations of rate cuts could weigh on yields, while a hawkish Fed stance may push them higher alongside the dollar," said Iakopa.
"Markets currently anticipate two rate cuts by year-end."
9:50am: Wall Street in positive mood
Wall Street has woken up in a moderately positive mood, with the S&P 500 index up 0.4%, trailing gains of 0.5% for the Dow Jones and 0.55% for the Nasdaq Composite.
All of the Nasdaq's tech titans are in the green, led by a 3.3% rise for Tesla and 1.1% for Nvidia and Apple.
8am: Nasdaq set to lead rebound ahead of Fed decision
US stocks are being tipped to open higher today ahead of the Federal Reserve decision later.
Ahead of the opening bell, S&P 500 futures were up 0.2% and Dow Jones futures just above flat, while Nasdaq 100 futures were up 0.3%.
This followed the S&P falling 1.1% the day before, swinging back towards correction territory for the second time in a week, while the Nasdaq dropped 1.7% and the Dow 0.6%.
The 'Magnificent 7' tech giants are down 16.2% so far this year, with the S&P 500 down 4.5%, though the equal-weight S&P 500 is down just 1% in the year to date.
"Outside of the Mag-7 it's just a small sell-off so far," says Jim Reid at Deutsche Bank. "So when we think about the US market falls this year I would say sentiment changes towards the Mag-7 are a bigger impact domestically than the trade headlines even if both matter."
On the Fed decision, market analyst Kenny Polcari at Slatestone Wealth said "no one expects" Jerome Powell and co to change rates at all, "but the excitement is about what they ‘expect’ him to say at the presser at 2:30 pm.
"Will he tease us about a rate cut in the ‘near term’? Will he tackle questions about Trumps tariffs? Will he suggest that a recession knocks on our door? Will he tell us that inflation is no longer an issue? Will he tell us it is entirely possible for rates to go up vs down? What will he say about the Atlanta FED’s GDP forecast? So many questions…"
Gold prices continued to climb overnight, topping $3,045, up over $120 over the past week.
Crude oil also continues to thrash about, with WTI sinking to a week's low of just over $66 a barrel but climbing back in recent hours to $66.7.