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Tech Jitters and Fed Uncertainty Weigh on Markets

U.S. stocks slipped as a pivotal week began, with investors bracing for a wave of Big Tech earnings and the Federal Reserve’s upcoming policy decision. The Dow, S&P 500, and Nasdaq all edged lower, reflecting a cautious mood across markets. The pullback follows a choppy stretch for equities, as major indexes have struggled to regain momentum amid shifting expectations for interest‑rate cuts and ongoing geopolitical concerns. Tech stocks, in particular, have been under pressure after consecutive weekly declines, raising the stakes for earnings reports from industry giants. Apple, Microsoft, Meta, and Tesla are all set to report in the coming days, and their results could determine whether the sector reclaims leadership or continues to drag on broader market performance. With the Fed meeting approaching, traders are looking for clarity on the central bank’s rate‑cut timeline. Until then, many appear content to stay on the sidelines as uncertainty hangs over the week ahead.
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Federal Reserve Signals Slower Rate Cuts Amid Economic Uncertainty

 

The Federal Reserve is poised to announce a quarter-point rate cut on Wednesday, reducing its benchmark rate from 4.6% to approximately 4.3%. This move follows a half-point cut in September and a quarter-point reduction in November. However, Fed officials are signaling a slower pace of rate cuts in 2025, with expectations of only two or three reductions compared to the four previously anticipated.

The central bank's policymakers are recalibrating their approach as inflation has significantly decreased from its peak of 7.2% in June 2022 to 2.3% in October. Despite this progress, inflation remains above the Fed's 2% target, and the economy continues to grow robustly. Fed Chair Jerome Powell has emphasized the need for caution as the benchmark rate approaches a "neutral" level that neither stimulates nor hinders economic growth.

The upcoming presidential administration's proposed economic policies, including potential tariffs and tax cuts, add to the uncertainty surrounding future rate decisions. As a result, Americans may see only slight relief from high borrowing costs in the near future.




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