Will Fed Minutes still matter? 09/04/2025

HOT stories for today

 

US market wrap:
 

• Stocks slid on Tuesday as a brief relief rally quickly fizzled and investor nerves resurfaced.  Earlier optimism had been driven by President Trump’s comments about ongoing discussions with South Korean officials and Treasury Secretary Scott Bessent’s announcement that he would personally oversee upcoming trade talks with Japan. Much like Monday, market sentiment shifted sharply following a social media post—this time triggered by a White House report confirming that the Trump administration would proceed with the 104% tariff package, citing China’s refusal to concede. The VIX — Wall Street’s volatility gauge — closed at a five-year high, leaving markets jittery and directionless. 
• The Dow Jones Industrial Average fell 0.84%, with Apple leading the decline as concerns mounted over rising production costs tied to new tariffs on Chinese imports. Earlier in the session, the Dow had been up as much as 3.9%, highlighting the scale of the reversal. The S&P 500 dropped 1.57%, marking its sharpest intraday turnaround since at least 1978, while the Nasdaq Composite sank 2.15%, capping a fourth consecutive session of heightened volatility since the Trump tariff measures were introduced. 

Will Fed Minutes still matter?

• Investors will closely scrutinize the Federal Reserve’s March meeting minutes, due at 2 p.m. ET, though the landscape has shifted dramatically since that gathering. At the March 19–20 meeting, policymakers left rates unchanged at 4.25%–4.50% and projected three rate cuts for 2025. Since then, President Trump’s sweeping tariff announcement on April 2 has triggered market turmoil, sending stocks sharply lower and sparking fresh recession fears. Fed Chair Jerome Powell struck a more hawkish tone in a subsequent speech, warning of heightened risks to both inflation and employment. Markets are now pricing in four rate cuts this year, reflecting the rapid change in sentiment.
• While the minutes offer a pre-tariff snapshot, investors will be reading between the lines for signs of internal divisions on inflation, trade, and financial stability. Clues on the future of the Fed’s balance sheet reduction may also emerge, especially after Powell hinted the process could pause as early as June. Seasoned Fed watchers will analyze the language for subtle cues—terms like “transitory”, “persistent”, or the use of counting words such as “a few” or “a majority”, which often reveal disagreement among officials. The next FOMC meeting is scheduled for May 6–7, but today’s minutes could still help shape expectations—if only as a reference point in a rapidly evolving policy landscape.

 
Stocks on the move: 
      

• UnitedHealth Group [UNH], Humana [HUM] — Leading health insurers rallied after the Centers for Medicare and Medicaid Services (CMS) announced a larger-than-anticipated increase in payments for Medicare Advantage plans. UnitedHealth shares rose 5.4%, while Humana surged 10.7% on the news.
• Lockheed Martin [LMT] — Shares gained 2.9% amid a broader uptick in the defense sector, following President Trump’s commitment to a $1 trillion defense budget for the fiscal year.
• Tilray Brands [TLRY] — The cannabis company’s stock tumbled 21.2% after reporting disappointing third-quarter earnings. Tilray posted an adjusted EBITDA of $9 million, missing analysts’ forecast of $9.7 million, according to FactSet.
• Wells Fargo [WFC] — Shares of the banking giant slipped slightly, after rising nearly 4% earlier in the day. Piper Sandler upgraded Wells Fargo to “Overweight” from “Neutral”, citing an appealing valuation that reflects the firm’s improving outlook.
   

Today’s action

• Markets across the Asia-Pacific region declined sharply Wednesday as President Donald Trump’s latest country-specific tariffs officially came into force. Japan’s Nikkei 225 lost 3.14% and the Topix dropped 3.26%. South Korea’s Kospi slipped 0.95%, officially entering a bear market. In Hong Kong, the Hang Seng Index tumbled 3.86%, and the Hang Seng Tech Index sank 5.42%, as concerns over escalating trade tensions deepened. The new tariffs, which build on the initial 10% duty introduced over the weekend, bring the cumulative rate on Chinese imports to 104%.
• U.S. stock futures dropped ahead of Wednesday’s open, with investors on edge over the economic impact of the tariffs. Dow futures were down 469 points (–1.2%), S&P 500 futures slid 1.5%, and Nasdaq-100 futures dropped 1.8%. The S&P 500 hovered near bear market territory following four days of heavy selling, the worst stretch since the onset of the 2020 pandemic crash. Aside from the trade concerns, investors are also closely watching for the release of the Federal Reserve’s March meeting minutes, due Wednesday, which may offer clues on future policy direction amid the mounting market volatility.

Watchlist: AAPL, TSLA, NVDA, PLTR, HUM, LMT, DAL, STZ

Bitcoin

• Bitcoin [BTC] dipped below $77,000 on Tuesday after briefly climbing to $80,000 earlier in the session, as crypto markets mirrored the cautious rebound seen in traditional assets. The move reflects ongoing market jitters sparked by President Trump’s tariff escalation, which continues to weigh on investor sentiment.
• Despite the retreat, Bitcoin maintains a market cap of $1.55 trillion, down just 0.21% from the previous day, signaling relative stability in the face of broader risk-off trends. Bitcoin’s market dominance slipped to 63.34%, down 0.26% over 24 hours, as some traders rotated out of BTC. However, altcoins continue to underperform, further reinforcing Bitcoin’s status as the crypto market’s relative safe haven.
  Watchlist: Bitcoin: 74 000-100 000, Ethereum:1400-2600, Solana: 80-150
   

Forex
 

• The EUR/USD pair edged higher to around 1.1065 during Wednesday’s early European session, supported by a weaker U.S. Dollar (USD) following the implementation of President Trump’s reciprocal tariff plan. Traders are positioning cautiously ahead of the FOMC meeting minutes and a scheduled speech by Fed official Thomas Barkin later in the day. With Eurozone recession risks rising, markets are increasingly pricing in rate cuts from the ECB in both April and June, though the EUR has remained resilient against the USD in the near term.
• Meanwhile, the Japanese Yen (JPY) extended gains, retesting its strongest level against the dollar since October 2024 during the Asian session. The move reflects broad safe-haven demand, as fears grow over the global economic impact of escalating U.S. trade actions. Expectations of a U.S.–Japan trade deal, following reports that Trump has agreed to meet Japanese officials, also buoyed sentiment toward the Yen. Diverging policy outlooks between the Bank of Japan and the Federal Reserve continue to add pressure to USD/JPY, increasing the potential for further downside.
  Watchlist: EUR/USD: 1.0700-1.1100, USD/JPY: 144-150
   

Basic Materials

• West Texas Intermediate (WTI) crude fell to around $57.25 in early Asian trading Wednesday, extending its decline to levels last seen nearly four years ago. The slide reflects mounting fears of a U.S. recession, escalating trade tensions between the U.S. and China, and weakening global demand. While the API reported a 1.057 million-barrel drop in U.S. crude inventories last week, the data offered little support amid growing macroeconomic concerns fueled by President Trump’s aggressive trade stance.
• Meanwhile, gold (XAU/USD) attracted renewed buying interest, climbing above the key $3,000 threshold as investors flocked to safe-haven assets. The move comes as markets brace for a tariff-induced global slowdown and increasingly price in a return to Fed rate cuts, possibly starting as early as May. While the rising U.S. bond yields could limit further upside for the metal in the short term, expectations of multiple rate reductions by year-end continue to bolster gold’s appeal against a backdrop of broad risk aversion.
  Watchlist: GOLD 2600-3100, US Oil: 57.00-70.00

Key Economic Events Today:

EST time
10:00 am: USD Final Wholesale Inventories
10:30 am: USD Crude Oil Inventories
11:00 am: USD FOMC Member Barkin Speaks
02:00 pm: USD FOMC Meeting Minutes

Earnings

BMO (Before the US Market opens)
DAL            Delta Air Lines
SMPL         The Simply Good Foods
NEOG        Neogen Sorp.
AMC (After the US Market closes): STZ, PSMT, LAKE

The TEFS Analyst team wishes you a successful day!