U.S. stock markets closed with a mixed tone as the Federal Reserve hinted at potential interest rate cuts, causing the S&P 500 to finish nearly unchanged, the Dow Jones to dip slightly, and the Nasdaq to edge up. The Fed’s projections suggest a likelihood of two rate cuts by the end of 2025, aiming to mitigate concerns over inflation spurred by tariffs. While inflation has been relatively subdued, recent oil price spikes due to geopolitical tensions have added pressure.

Federal Reserve Chair Jerome Powell emphasized the uncertainty surrounding tariffs, cautioning that the forecast for rate cuts may not materialize given the unpredictable economic landscape. Powell highlighted the need for patience in assessing the impact of tariffs on inflation, spending, and hiring before making significant monetary policy decisions.

On the geopolitical front, fluctuating oil prices influenced by the Israel-Iran conflict added to market uncertainties. Meanwhile, Nucor’s positive profit outlook boosted its stock performance. In the bond market, Treasury yields remained stable despite mixed economic reports on reduced unemployment benefit claims and lower-than-expected home construction activity.

Global stock markets showed mixed trends, with Tokyo’s Nikkei 225 rising while Hong Kong’s Hang Seng declining significantly. The evolving economic and geopolitical landscape continues to shape market sentiments, underscoring the importance of vigilant monitoring and strategic decision-making in the financial realm.