[New York Stocks] Fed Holds Rates Steady for Third Time... Mixed Close as Oil Prices Surge

"Rising Energy Prices Reflected in Inflation"
Brent Crude Reaches Highest Level in Four Years
Alphabet Earnings Announcement Imminent

As the U.S. Federal Reserve (Fed) kept its benchmark interest rate unchanged for the third consecutive time, concerns emerged that energy supply disruptions could persist longer than anticipated, resulting in a mixed close for the three major New York stock indexes on April 29 (local time).

At the New York Stock Exchange (NYSE), the Dow Jones Industrial Average ended at 48,861.81, down 280.12 points (0.57%) from the previous trading day. The S&P 500, which focuses on large-cap stocks, fell by 2.85 points (0.04%) to 7,135.95. The tech-heavy Nasdaq Composite Index closed at 24,673.241, up 9.441 points (0.04%).

View of the New York Stock Exchange. New York, USA – Photo by Yoonjoo Hwang

On this day, the Fed announced following the April Federal Open Market Committee (FOMC) meeting that it would keep the benchmark interest rate unchanged at 3.50~3.75%. Fed Chair Jerome Powell, in a press conference, referenced high energy prices and explained, "This will drive overall inflation higher."

The Fed had lowered interest rates for three consecutive meetings in September, October, and December last year. However, in January, March, and now April of this year, the Fed has decided to keep rates unchanged for three consecutive meetings. This decision is attributed to the view that soaring international oil prices, spurred by the aftermath of the Iran war, are fueling inflation.

Notably, this FOMC meeting drew attention as internal disagreements over the direction of monetary policy widened. Four out of the twelve committee members opposed the decision. The Wall Street Journal noted that this was the highest number of dissenting votes since October 1992.

Additionally, Chair Powell stated that he would remain on the Fed Board of Governors after his term as Chair ends. CNBC assessed that Powell's continued presence as a Board member reduces the likelihood of a Fed rate cut. There are a total of seven Fed Board members, three of whom were appointed by U.S. President Donald Trump. With Powell remaining on the Board, Trump Administration appointees do not constitute a majority.

Brent Crude Hits Four-Year High... Major Tech Earnings Released After Market Close

On this day, international oil prices rose on expectations that the blockade of the Strait of Hormuz would persist. This followed President Trump's interview with Axios, in which he stated, "The strait will remain blocked until Iran agrees to a nuclear deal."

On the ICE Futures Exchange, June delivery Brent crude surged 6.1% from the previous session to close at $118.03 per barrel. Brent crude climbed as high as $119.76 per barrel during intraday trading, marking its highest level in about four years since June 2022. On the New York Mercantile Exchange, June delivery West Texas Intermediate (WTI) crude rose 6.95% to end at $106.88 per barrel.

The market is also focused on Alphabet's earnings announcement, scheduled after the market close. Chris Brigati, Chief Investment Officer at SWBC, commented, "While major technology companies' earnings are generally expected to surpass estimates, market attention is centered on growth trajectory and outlook for future investment pace." He added, "Delivering tangible results from high capital expenditures remains a key concern."

Most of the large-cap stocks by market capitalization declined during the session. NVIDIA fell 1.94%, Apple 0.20%, Microsoft 2.86%, Amazon 0.21%, TSMC 0.55%, Tesla 0.96%, and Meta 5.42%. However, Alphabet, which was set to announce earnings that day, soared 4.61% from the previous session to close at $365.90. Broadcom also rose 1.49% to end the session.

This content was produced with the assistance of AI translation services.