Broad market declines as caution returns
Wall Street retreated on Wednesday, with major indices slipping as investors weighed Federal Reserve signals, rising Treasury yields, and key corporate results. The Dow Jones Industrial Average dropped 244 points, or 0.58%, to finish at 42,098.70. The S&P 500 shed 0.56%, and the Nasdaq Composite lost 0.51%.
The pullback followed Tuesday’s sharp rebound, when optimism around delayed EU tariffs lifted markets. But Wednesday brought renewed uncertainty, especially after the Fed’s latest meeting minutes revealed a more cautious tone.
Fed minutes signal policy dilemma
Minutes from the Fed’s May meeting showed officials are increasingly worried about persistent inflation and slowing growth. The committee warned it may face “difficult tradeoffs” if tariffs aggravate price pressures just as employment risks rise. While no immediate policy change was expected, the tone dampened hopes for a rate cut in the near term.
Participants also questioned the usefulness of the Fed’s current inflation-targeting framework in an environment prone to external shocks like trade policy disruptions.
Nvidia beats expectations again
After the US markets close, Nvidia delivered a blowout first-quarter result. Revenue soared 262% year-on-year to US$26bn, beating forecasts. Earnings per share came in at US$6.12, comfortably ahead of expectations.
CEO Jensen Huang said demand for AI infrastructure “has never been stronger”. The company announced a 10-for-1 stock split and raised its quarterly dividend by 150%.
Nvidia also issued stronger-than-expected guidance for the second quarter, projecting US$28bn in revenue. The results are likely to set the tone for AI-exposed tech stocks in the coming sessions.
Retail surprises: Abercrombie surges
Among earlier movers, Abercrombie & Fitch closed up 14.67% after topping first-quarter expectations and raising its sales guidance, despite trimming its profit outlook due to tariffs. Hollister, its teen-focused brand, saw 22% sales growth.
Commodities and the dollar
Brent crude is trading 1.2% higher at US$64.86 a barrel, on the back of OPEC+ leaving its formal output quotas unchanged.
WTI crude is trading 1.49% higher at US$61.80 a barrel.
Spot gold is trading 0.16% lower at US$3295.56 an ounce.
Gold futures (COMEX) are trading 0.18% lower at US$3322.20 an ounce.
One Australian dollar is buying 64.28 US cents.
Futures
The SPI futures are pointing to a modest 5-point rise.
