📆 Wednesday, March 19
► European markets are mixed as investors awaited the Federal Reserve's interest rate decision, with the Stoxx 600 trading flat recovering from a slide at the start of the day. Germany's recent approval of a historic €500 billion spending plan had lifted equities earlier in the week. However, market sentiment remains fragile following reports of a stalled ceasefire deal between Russia and Ukraine, leading to further uncertainty, as well as concerns of little support for the markets from the Fed for now. Meanwhile, Turkey’s lira crashed over 10% to a record low, sparking a trading halt on the country’s stock exchange. The sharp decline followed the detention of Istanbul’s mayor, Ekrem Imamoglu, a key political rival of President Recep Tayyip Erdogan, raising concerns over political instability and the country’s economic future. The Eurozone inflation figures for February (final) confirmed the preliminary figures (2.6% core inflation YoY, down from 2.7% in January).
► US stock futures traded cautiously, with S&P 500 (+0.2%) and Nasdaq 100 (+0.25%) futures trading slightly higher as markets braced for the Fed’s policy announcement and Chair Jerome Powell’s comments. The central bank is widely expected to keep rates unchanged, but investors will focus on the dot plot projections to gauge potential rate cuts later in the year. Wall Street suffered losses on Tuesday, with the S&P 500 dropping 1.07%, led by tech / growth stocks, as concerns over Trump’s tariffs, a slowing US economy and no immediate support for the struggling markets from the US government or the Fedpressured sentiment. The partial “ceasefire” agreement between Trump and Russian President Vladimir Putin failed to boost market confidence, as Russia continued drone strikes on Ukraine’s infrastructure, despite agreeing to halt attacks on energy facilities. Putin is pulling the strings while Trump is the puppet – the question is whether Trump realizes it or is too vain to admit his failure in the negotiations. Meanwhile, Treasury yields remained steady, reflecting investor caution, while the USD strengthened, benefiting from expectations of a rate pause and no clear path for future rate cuts ahead of the Fed’s announcement.
► Asian markets were mixed, reflecting Wall Street’s losses and the Bank of Japan’s cautious approach to monetary policy. Japan’s Nikkei 225 fell 0.2% while the JPY weakened slighlty, nearing 149.5/USD, after the BOJ kept interest rates unchanged at 0.5%, citing uncertainties surrounding global trade tensions. Investors remained focused on BOJ Governor Kazuo Ueda’s comments, as he highlighted rising inflation risks but refrained from signaling aggressive policy tightening. China’s Shanghai Composite dropped 0.11%, as investors took profits following a strong rally in AI and tech stocks, while the Shenzhen Component lost 0.32%. Hong Kong’s Hang Seng Index saw a 0.12% gain, marking its fourth straight day of advances, supported by financial stocks and optimism over Beijing’s latest stimulus measures.
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