Markets Stall as Fed Decision Takes Center Stage

​Waiting for the Finale
It feels like the calm before a season finale. Investors are holding back as the Federal Reserve’s meeting wraps up, with everyone focused on the rate decision and Powell’s press conference.

Stocks in Limbo
On Tuesday, U.S. markets barely moved. The S&P 500 dipped 0.13%, though it still managed to close above the milestone it set earlier this week. Traders simply didn’t want to make bold bets ahead of the Fed.

Bigger Picture, Bigger Stakes
Beyond the Fed, the news cycle still pointed toward the future. Trump once again extended the deadline for ByteDance to divest TikTok’s U.S. business, and more U.S.-China trade talks are slated before November. The backdrop: markets waiting for clarity, both economic and political.

The Likely Cut
Most analysts expect the Fed to trim rates by 25 basis points, while talk of a larger half-point slash remains unlikely. Still, the debate inside the Fed could turn lively, especially with political pressure mounting.

Politics in Play
Trump’s newly confirmed Fed pick, Stephen Miran, is expected to push for a deeper cut than consensus. His arrival adds a layer of political drama rarely seen at the Fed. Investors will be watching whether Powell can keep the tone neutral and market-calming.

Other Global Highlights
- China: Keeping a tight grip on rare earth exports, frustrating foreign firms.
- Baidu: Shares spiked nearly 16% after AI advances and a state-linked deal boosted confidence.
- Japan: Exports are still falling, but the decline slowed in August.
- AI in China: UBS notes domestic leaders are emerging as companies successfully monetize generative AI.

The Bottom Line
​The financial world is on pause, waiting for Powell’s words and the Fed’s rate call. Investors know a quarter-point cut is likely — but it’s the tone and outlook for the rest of 2025 that could set the market’s next big move.