The last FOMC meeting in its minute saw the Fed holding interest rates steady with a target range of 5.25–5.50%, noting recent moderation in economic growth and job gains. Inflation has eased over the past year but remains high, and the Committee reiterated its strong commitment to return inflation to the 2% target. The Fed is driven to reduce its holdings of Treasury and mortgage-backed securities as planned and remains data-dependent, prepared to adjust policy if risks emerge that impede their goals.
EQUITY
Wall Street's January blues deepened on Wednesday, as profit-taking and opaque Fed signals overshadowed December's inflation optimism. The S&P 500 slumped for a second straight day, with megacap tech stocks like Nvidia and Tesla bearing the brunt of the selloff. Airline stocks buckled under rising oil prices, while financials like Charles Schwab and Blackstone stumbled on downgrades, contrasting the lone bright spot of Citigroup's continued ascent on upgrades by Wells Fargo.
GOLD
The gold market treads water as a stronger dollar and climbing bond yields temper its near-term action. Though minutes from the Fed's December meeting hint at eventual rate cuts, the door remains ajar for extended monetary tightening. Mixed economic data, including slowing manufacturing and declining job openings, adds to the uncertainty, with investors awaiting key employment figures Friday for the next directional cue.
OIL
Geopolitical turmoil in the Middle East, led by a production halt at Libya's Sharara field and the escalating Israel-Hamas conflict, pushed Brent crude past $78 per barrel on Thursday, building on the previous day's 3% rally. The concern for supply disruptions, coupled with a larger-than-expected draw in U.S. inventories, outweighed weak demand and economic growth concerns.
CURRENCY
The dollar recouped recent losses as minutes from the December meeting revealed officials acknowledging inflation's retreat but stressing the need for sustained restraint, causing a risk-off mood. Asian currencies remained flat as traders awaited Friday's crucial US jobs data for further Fed clues. While a soft-landing scenario looms in the US, the pace and scale of rate cuts remain unclear, keeping markets on edge.
