Dow Jones opened flat on Wednesday as investors cautiously await the next move of US President Donald Trump in the recent Israel-Iran conflict.
At the open, the Dow Jones, S&P 500, and Nasdaq Composite were all hovering within 0.1% of unchanged, reflecting a cautious start as investors awaited key Fed signals and monitored ongoing geopolitical tensions
Donald Trump shared some steamy posts on X where he warned Iran’s supreme leader. The US President made it clear that nothing short of an “unconditional surrender” would be expected.
The developments heated the buzz around the conflict, with Iran looking in no position to back down from a full-blown war.
Investors on Wall Street are navigating their way through the choppy markets as Dow Jones and other indices gained on Monday, but a quick reversal was seen on Tuesday.
Ahead of the opening bell, the Dow Jones futures traded 100 points up, while the S&P 500 and Nasdaq futures were trading 20 and 100 points higher.
Markets largely brushed off the weaker-than-expected retail sales and industrial production data reported earlier in the day, with investors instead focusing on broader themes like Fed policy and geopolitical developments.
US Fed’s economic outlook may impact Dow Jones, other indices
All eyes are on US Fed Chair Jerome Powell as he prepares to announce the Federal Open Market Committee’s (FOMC) policy decision later today.
While it’s almost certain the Fed will keep interest rates steady at 4.25% to 4.5%, the investors will be highly interested in the central bank’s economic outlook.
The Fed’s updated economic projections and the closely watched “dot plot” will offer insight into policymakers’ expectations for growth, inflation, and the number of rate cuts they anticipate for the rest of 2025.
With anxiety running high over the Israel-Iran conflict, investors are laser-focused on how the US Fed sees the economy shaping up in the months ahead.
The backdrop is complicated: tariffs are threatening to push prices higher, global growth is showing signs of strain, and the Middle East crisis has only added to the sense of unpredictability.
US jobless claim data may turn heavy for indices
The fresh data around jobless claims in the United States may impact the market sentiment as people applying for US unemployment benefits fell slightly last week.
For the week ending June 14, the jobless claims declined by 5,000 to 245,000, which is in line with the economists’ expectations.
While this marks a modest improvement, claims remain near their highest levels in eight months, signaling ongoing softness in the labor market.
Continuing claims, which track the number of people still receiving benefits, also edged down to 1.95 million in the previous week.
The data can be volatile, especially around holidays or during the summer when school employees may file for benefits.
The overall trend however, has been upward, reflecting a gradual slowdown as layoffs rise and businesses face headwinds from tariffs and global uncertainty.
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