Caution Ahead of the Interest Rate Decision: US Markets Dive

There is a noticeable restraint at the financial centers in New York, as investors adopt a wait-and-see attitude on the day before the expected interest rate decision by the US Federal Reserve. Market observers are noting a decreasing willingness to take risks, which is reflected not only in the stock markets but also in the correction of digital currency prices. After a positive start to the week, slight losses are emerging for the major stock indexes. Before the start of trading, a decline of 0.2 percent is forecasted for the Dow Jones Industrial. The tendency for the tech-heavy Nasdaq 100 portfolio even indicates a decrease of 0.7 percent, putting the recently reached peaks further out of reach. The tension is palpable as the financial world awaits the upcoming Federal Reserve interest rate decision. Although a rate cut is not under discussion, interest is particularly focused on the possibility of a first monetary policy easing, anticipated by a narrow majority for June. Market participants are carefully weighing the analysis of economic and employment-related conditions with the expectations for the Fed's monetary policy direction. It is also being discussed that the Bank of Japan could move away from its negative interest rate policy infrastructure after more than a decade. Meanwhile, UBS expressed skepticism regarding the so-called "Goldilocks scenario" for the US economy. Signals that could dampen confidence in a smooth economic development were cited, but the bank sees these more as a downshift in pace rather than a brake on overall growth. The tendency towards a decline in prices is particularly evident in volatile technology stocks. Nvidia shares came into focus as they registered a pre-market loss of 2.6 percent, despite new AI technology solutions presented at a developer conference. Jensen Huang, CEO of Nvidia, announced a new computing platform that had already sparked a record rally among investors. The technology, which could lead to an industrial revolution, is being used by companies like Cadence Design and Synopsys, whose stocks experienced pre-market gains of up to 1.6 percent. Another announcement concerned Fusion Pharmaceuticals, whose shares soared by 100 percent after AstraZeneca made a takeover bid that slightly exceeded the proposed sum and promised additional incentives upon achieving corporate goals. Finally, the slide in digital currencies put companies active in this sector under pressure. The trading platform Coinbase had to accept a pre-market decline of five percent before the start of trading. The fall in Bitcoin value was attributed in part to capital outflows from a new US Bitcoin fund.