Wall Street Falls as Investors Brace for Federal Reserve Decision

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Wall Street Falls as Investors Brace for Federal Reserve Decision/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ U.S. stocks dipped Tuesday as Wall Street awaits the Federal Reserve’s decision on interest rates, set to be announced Wednesday. The S&P 500 fell 0.5%, the Dow dropped 107 points (0.3%), and the Nasdaq declined 1.1%. Investors are watching for signals on potential rate cuts and how the Fed will address inflation concerns tied to Trump’s upcoming tariffs. Tesla shares tumbled 5.6%, dragging markets lower, while Google’s parent company, Alphabet, slipped 0.6% after announcing a $32 billion cybersecurity acquisition. Global markets mostly rose, with Japan’s Nikkei gaining 1.2%, though Indonesia’s stock exchange was briefly suspended after a sharp decline.

Traders work on the floor of the New York Stock Exchange, Tuesday, March 11, 2025. (AP Photo/Richard Drew)

U.S. Stocks Drop as Wall Street Awaits Fed Decision: Quick Looks

Markets Lower: The S&P 500 fell 0.5%, the Dow dropped 107 points (0.3%), and the Nasdaq slid 1.1%.
Tesla Tumbles: Shares sank 5.6% as concerns about Elon Musk’s political ties and rising competition hit investor sentiment.
Federal Reserve in Focus: The Fed is expected to keep rates unchanged but could hint at future cuts amid tariff-driven inflation risks.
Google’s $32B Deal: Alphabet shares fell 0.6% after announcing its largest-ever acquisition of cybersecurity firm Wiz.
Global Markets Mixed: Japan’s Nikkei rose 1.2%, but Indonesia’s market was briefly suspended after a steep drop.
10-Year Treasury Yield: Dipped to 4.30% from 4.31% on Monday.

Wall Street Declines as Investors Await Fed’s Interest Rate Decision

Fed’s Rate Decision Looms Over Markets

U.S. stocks opened lower Tuesday, with investors anxiously awaiting the Federal Reserve’s policy announcement on Wednesday. Markets are seeking clarity on interest rate cuts and how the central bank will respond to inflationary pressures tied to Trump’s trade policies.

S&P 500: Down 0.5%
Dow Jones: Dropped 107 points (-0.3%)
Nasdaq Composite: Fell 1.1%

The stock market recently staged a small recovery, rebounding from a 10% plunge, but uncertainty over tariffs and interest rates continues to weigh on investor sentiment.

Tesla’s Struggles Deepen as Shares Fall 5.6%

Tesla’s stock continued its downward trend, sliding 5.6% on concerns about:

Elon Musk’s political involvement and alignment with Trump’s budget cuts.
Growing competition from Chinese EV makers, particularly BYD, which unveiled an ultra-fast charging system on Monday.

Tesla’s stock has faced volatility in recent months as the brand’s political and market challenges raise investor concerns.

Federal Reserve to Keep Rates Steady, But for How Long?

The Federal Reserve is widely expected to leave interest rates unchanged, but Wall Street will closely analyze its updated economic projections for clues about:

Possible rate cuts later in 2025
Inflation risks tied to Trump’s tariffs
U.S. economic outlook and recession fears

While markets expect two or three rate cuts this year, uncertainty remains over whether inflation concerns could force the Fed to hold rates higher for longer.

Google’s Parent Alphabet Slips After $32 Billion Deal

Alphabet shares fell 0.6% following its announcement to acquire cybersecurity firm Wiz for $32 billion—the largest acquisition in Google’s history.

The deal is aimed at strengthening Google’s cloud security amid growing AI and cybersecurity threats.
Investors worried about the high price tag, questioning whether the acquisition will generate strong returns.

Global Markets Mixed as Asia Rallies, Indonesia Struggles

While major European and Asian markets mostly rose, Indonesia’s stock exchange was temporarily suspended after a sharp decline.

Japan’s Nikkei 225 gained 1.2%, as investors expect the Bank of Japan to hold rates steady at its upcoming meeting.
Indonesia’s JSX index plunged 6% before bouncing back to a 3.8% loss, following concerns over a new sovereign wealth fund and tariff uncertainties.

Bond Market Update: 10-Year Treasury Yield Dips

In bond markets, the yield on the 10-year Treasury edged lower to 4.30% from 4.31% on Monday, reflecting:

Cautious investor sentiment ahead of the Fed’s decision
Uncertainty around long-term economic growth

What to Watch Next

Wednesday: Federal Reserve interest rate decision and economic outlook update.
April 2: Trump’s new global tariffs take effect, potentially influencing inflation and economic growth.
Ongoing market reaction to Tesla’s struggles and Alphabet’s high-stakes cybersecurity deal.

With the Fed’s decision and economic uncertainty looming, Wall Street remains on edge as traders wait for direction.