Daily Market Recap: Fed Signals, Sector Gains, and Key Trends

Image Source : Krish Capital Pty Ltd

Index Update

All 11 S&P sectors gained, led by consumer discretionary, energy, and technology stocks, following the Fed’s decision to hold rates while projecting future cuts amid slowing growth and weaker employment. Despite inflation risks from Trump’s trade policies, Fed Chair Powell downplayed tariff concerns. Investors now await jobless claims data and earnings reports from Nike, FedEx, Micron Technology, and Darden Restaurants.

Market Movers

On Wednesday, the top gainers were Black Diamond Therapeutics, Inc (+38.69%), followed by Bowen Acquisition Corp (+18.84%). On the contrary FST Corp. (-34.43%) and GDS Holdings Limited (-16.47%) declined the most the same day.

Commodities Update

Oil prices have fluctuated over the past two weeks, with WTI crude futures around $67 per barrel. Geopolitical tensions, including Israel's renewed ground offensive in Gaza, US airstrikes on Houthi rebels, and ongoing Ukraine-Russia conflict uncertainties, have pushed prices upward. However, supply remains balanced, with gasoline inventories declining but crude oil stocks rising. Additionally, OPEC+ plans to increase production by 138,000 bpd in April, marking its first output hike since 2022, which could add more supply to the market.

Macro Update

The dollar index hovered around 103.4, near a five-month low, after the Fed held rates but reaffirmed plans for two cuts this year. Despite uncertainties over Trump’s policies, the Fed projected further rate reductions through 2025, lowered its growth forecast, and raised its inflation outlook. Fed Chair Powell downplayed tariff concerns, while markets aligned with Fed expectations, pricing in the first rate cut by mid-year. Investors now await jobless claims data for labor market insights.

Futures Update

US stock futures rose on Thursday after the Federal Reserve reaffirmed plans for two rate cuts in 2024. In the previous session, the Dow gained 0.92%, the S&P 500 increased by 1.08%, and the Nasdaq Composite climbed 1.41%.

Bitcoin traded at $85,190 on March 20, down 1.87% from the previous session. Over the past four weeks, it declined by 11.35%, but it remains up 30.13% over the past year.

Stocks rebounded strongly on Wednesday, recovering most of the steep losses from Tuesday's trading. The Nasdaq rose by 246.67 points (1.4%) to 17,750.79, and the S&P 500 increased by 60.65 points (1.08%) to 5,675.30. Although the major indices slightly pulled back from their highs before the close, they finished significantly higher. The S&P 500 is testing key support levels and is expected to consolidate near resistance at 5,783, with support around 5,563. The 14-period RSI indicates a potential rebound might be forthcoming.