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Technology stocks struggled, with the sector falling 1.74%. Nvidia declined 3% ahead of its AI chip announcement, while Microsoft, Apple, and Cisco each lost more than 1%. Industrials and financials also faced pressure, slipping 1.17% and 0.42%, respectively. Energy was the only sector to post gains, rising 0.12% as oil prices remained stable. Meanwhile, defensive sectors such as healthcare and consumer staples outperformed the broader market, with minimal losses.
What’s Driving Market Uncertainty?
Investors are bracing for the Federal Reserve’s upcoming interest rate decision, with markets overwhelmingly expecting rates to remain unchanged. However, uncertainty around the Fed’s tone and future policy outlook has kept traders on edge. Fed funds futures indicate a 99% probability of a pause, but investors will closely watch Fed Chair Jerome Powell’s press conference for signals on inflation and economic risks.
Geopolitical concerns also weighed on sentiment. Traders monitored President Donald Trump’s scheduled call with Russian President Vladimir Putin, set to discuss a potential Ukraine ceasefire. While any progress could ease uncertainty, markets remained cautious.
Can the Market Stabilize?
Despite the brief relief rally earlier this week, the S&P 500 remains nearly 9% below its peak, and the Nasdaq is still in correction territory. Weak technicals and lingering economic concerns have left stocks vulnerable to further declines.
The Fed’s stance on inflation and potential rate cuts could determine whether markets regain footing or continue their downward slide. Traders will be looking for reassurances that monetary policy will not tighten further, but until clarity emerges, broad-based selling pressure may persist.
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