Stock market today: gloomy start to May ahead of Fed decision

U.S. futures were down Wednesday morning ahead of a decision by the Federal Reserve on interest rates.

On Tuesday, the Dow Jones Industrial Average closed out April down 570 points, with the S&P 500 and Nasdaq down 1.6 percent and 2% respectively, marking the worst month of the year so far for equities.

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Amazon shares jumped in after-hours trading following a sales surge powered by investments in artificial intelligence technology at the company. The stock was up nearly two percent in pre-market Wednesday.

“There is a very large opportunity in front of us,” said CEO Andy Jassy on the earnings call.

Several high-profile brands are set to publish their quarterly earnings on Wednesday.

Mastercard, Pfizer, CVS, Marriott, Estee Lauder, The Kraft Heinz Company, and Yum! Brands—parent of KFC and Pizza Hut—are all scheduled to release their figures before markets open in the U.S.

Food delivery company DoorDash is expected to publish its earnings after the bell today.

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Pfizer shares were up Wednesday morning after news that Tidvak, a drug for treating cervical cancer, was awarded full approval by the Food and Drug Administration (FDA).

Positive results from a phase III clinical trial showed that Tidvak provided a 30 percent risk of death reduction when compared to chemotherapy. The trial involved 502 patients.

The clinical trials report also noted that Tidvak is predicted to make $744m in sales by 2029.

Chris Boshoff, chief oncology officer at Pfizer said in a press release that, “Full approval by the FDA reinforces the important role of Tidvak for these patients, as the first antibody-drug conjugate with statistically significant prolonged overall survival data.”

Investors are also anticipating an interest-rate decision from the Fed later on Wednesday, following a two-day policy meeting, and Chairman Jerome Powell’s press conference immediately after the rate announcement.

News that economic growth had slowed last quarter could put any hope that the Fed would cut interest rates to bed anytime soon, but investors will also be watching out for any clues on what lies ahead for the central bank’s rate path.

The rate has been held at 5.5 percent since July 2023, the highest level since early 2001, and one of the longest stretches without a rate change on record.

Inflation currently stands at 3.5 percent, above the Fed’s target of two percent.

Looking ahead, big names to watch this week include tech titan Apple, pharmaceutical company Novo Nordisk, Shell and Moderna.

Like Amazon, Apple has recently been fortifying its AI capabilities. Multiple reports suggest that it has been targeting rival Google‘s employees, in particular.

The company has also expanded into Zurich, establishing it’s “Vision Lab” in the Swiss city.

In February at the company’s annual shareholder meeting, Apple CEO Tim Cook promised investors that “Apple will break new ground” in the AI field in 2024.