U.S. equity futures traded close to unchanged on Wednesday as investors refrained from making major moves ahead of the Federal Reserve’s latest policy announcement and a series of high-profile corporate earnings releases.
Markets broadly expect the central bank to leave interest rates unchanged, although traders continue to price in the possibility of an unexpected quarter-point increase.
According to CME Group’s FedWatch Tool, there is a 64.2% probability that the Fed keeps rates on hold, while the likelihood of a 25-basis-point increase stands at 35.8%.
Attention will also focus on the Fed’s policy statement, although investors expect less forward guidance under Federal Reserve Chair Kevin Warsh’s streamlined communication approach.
Meta and Microsoft Results Could Shape Market Sentiment
Investors are also waiting for quarterly earnings from Meta Platforms (NASDAQ:META) and Microsoft (NASDAQ:MSFT), which are scheduled for release after Wednesday’s market close.
The reports are expected to provide fresh insight into artificial intelligence spending and could influence investor appetite for large-cap technology stocks following recent valuation concerns.
Dow Outperforms Despite Weakness in Technology
Wall Street ended Tuesday with mixed results after another volatile trading session.
The Dow Jones Industrial Average gained 537.24 points, or 1.0%, to close at 52,747.32, marking its third consecutive advance.
The S&P 500 edged 0.2% higher to 7,428.78, while the Nasdaq Composite slipped 0.2% to finish at 24,876.91.
Earnings Drive Diverging Sector Performance
Sherwin-Williams (NYSE:SHW) climbed 8.3% after posting stronger-than-expected quarterly earnings and raising its full-year guidance.
Coca-Cola (NYSE:KO) also advanced 5% after delivering quarterly results that exceeded forecasts and improving its outlook for the year.
Technology stocks remained under pressure, however, with semiconductor companies leading the declines.
The Philadelphia Semiconductor Index dropped 4.5% for a fourth consecutive session, reaching its lowest closing level in more than two months.
The NYSE Arca Computer Hardware Index also lost 2.5%, while oil services companies weakened as crude prices continued to fall.
Defensive Industries Offer Support
Healthcare stocks provided a bright spot, with the NYSE Arca Pharmaceutical Index rising 2.3% to a record closing high.
Telecommunications, airlines and homebuilding companies also posted gains, helping to offset weakness across the broader technology sector.
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