Stock market today: S&P 500, Nasdaq slide as Fed holds rates steady

Federal Reserve Chair Jerome Powell downplayed negative sentiment data, emphasizing that while public concern over inflation and tariffs is real, there’s little evidence so far of major economic impact.

“That shock hasn’t hit yet,” Powell said, adding the Fed is closely watching both sentiment and hard economic data. He noted that although weakening activity and rising inflation remain key concerns, the uncertain outlook makes it difficult to determine the appropriate policy response.

“Our policy is in a good place,” he said. “So we think we can wait and move when it is clear what the right thing to do is.”

Powell added a that — despite rising anxiety — job creation remains strong, unemployment is low, and the broader economy remains in “solid shape.”

President Trump has bashed Federal Reserve Chair Jerome Powell for not cutting interest rates in recent weeks.

At times, Trump has called Powell “a total stiff”, a “major loser” and “Mr. Too Late.” But Powell said Wednesday the noise doesn’t disrupt the Fed’s decision making.

“It really doesn’t affect either our job or the way we do it,” Powell said.

Federal Reserve Chair Jerome Powell said that the central bank’s 50 basis point rate cut in September was not preemptive but rather delayed, saying, “If anything, it was a little late.”

In 2019, Powell said the Fed cut rates three times due to a weakening economy and low inflation, allowing for preemptive action. Today, inflation remains above target and has been “for four years,” though it’s not drastically above target now.

“And we have an expectation conditional on what happens [with tariffs] that will see upward pressure on inflation,” he said, noting how some Wall Street forecasts predict rising inflation, economic weakening, and even a recession.

“But in any case, it’s not a situation where we can be preemptive because we actually don’t know what the right response to the data will be until we see more data.”

Federal Reserve Chair Jerome Powell reiterated several times in his first few responses to reporters on Wednesday that the central bank doesn’t “need to be in a hurry” to cut interest rates.

“The data may move quickly or slowly, but we do think we’re in a good position where we are to let things evolve and become clearer in terms of what should be the monetary policy response,” Powell said.

When asked if the economic outlook could change enough to make the Fed’s stance shift by its next meeting in June, Powell didn’t commit to such action.

“We think right now the appropriate thing to do is to wait and see how things evolve,” Powell said. “There’s so much uncertainty if you talk to businesses or market participants or forecasters, everyone is just waiting to see how developments play out. And then we’ll be able to make a better assessment of what the appropriate path for monetary policy is. … I can’t really give you a time frame on that.”

Just before the Federal Reserve rate decision hit the wires, President Trump said there is no plan to pull back on the 145% tariffs on Chinese goods in order to advance trade talks.

Trump was asked directly if he would lower the tariffs to help foster more productive negotiations. He responded bluntly, “no.” This headline appeared to send stocks lower just before the Fed’s policy announcement added to the selling.

In a widely anticipated move, the Federal Reserve held interest rates steady in a range of 4.25% to 4.5%.

The Federal Reserve made several key changes to the phrasing in its policy announcement. The committee said uncertainty about the economic outlook has “increased further.” The committee also added the following line to its statement.

“The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen,” the statement read.

Read more from Yahoo Finance’s Jennifer Schonberger here.

US stocks were mixed on Wednesday about 30 minutes before the Federal Reserve’s next interest rate decision.

The benchmark S&P 500 (^GSPC) was up about 0.2% while the tech-heavy Nasdaq Composite (^IXIC) fell about 0.1%. The Dow Jones Industrial Average (^DJI) rose about 0.7%, or by about 300 points. A sharp 7% drop in Alphabet (GOOGL, GOOG) shares weighed on the Nasdaq, while a 10% pop in Disney (DIS) stock powered the Dow higher.

Meanwhile, the 10-year Treasury yield (^TNX) was down about 2 basis points to hover at 4.28%. Below is a look at the sector action on the day.

Yahoo Finance’s Anjalee Khemlani reports:

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The Federal Reserve is widely expected to leave interest rates unchanged when it announces its next monetary policy decisions at 2 p.m. ET today.

And former Federal Reserve Bank of New York President Bill Dudley doesn’t think investors will learn much more abut the path forward during Fed Chair Jerome Powell’s press conference either.

“It’s basically going to be an abundance of caution,” Dudley said. “The Fed’s going to be sitting on its hands for some time.”

Dudley reasoned that the Fed won’t want to preemptively most interest rates while tariff discussions remain influx and economic data has largely shown the US economy remains on solid ground. He doesn’t expect Powell would answer questions about ongoing tariff negotiations.

“The Trump administration has an incentive to talk about negotiations, to try to be reassuring to financial markets,” Dudley said. “But whether those negotiations are going to be fruitful and over what time frame remains to be determined. So I think the Fed takes the world as it is, not the world how it wants it to be. And right now we have a threat of tariffs that are going to drive down growth and drive up inflation.”

Marvell Technology (MRVL) stock dropped roughly 11% midday Wednesday morning after the company postponed its investor day and narrowed its revenue guidance for its 2026 fiscal first quarter (the three months ending May 1).

The custom AI chipmaker’s investor day, previously set for June 10, will take place on June 17, the company said Tuesday.

“We have decided to postpone our investor day given the current uncertain macroeconomic environment,” said CEO Matt Murphy.

Marvell also lowered the top end of its revenue forecast for the first quarter. The company said it expects revenue of $1.875 billion, plus or minus 2%, compared to the prior range of plus or minus 5%.

Macroeconomic uncertainty is hitting chipmakers across the board, as Nvidia (NVDA) and AMD (AMD) grapple with new export bans on their chips to China and companies await potentially more restrictive changes from Trump to an already-strict AI trade rule under Biden (called the AI Diffusion rule) and tariffs on semiconductors.

Marvell stock has posted steep declines in 2025, falling more than 50% year to date after surging 83% in 2024, ahead of the S&P 500’s 23% gain and Nvidia’s 37% rise.

Marvell will release its first quarter earnings results on May 29 after the bell.

Alphabet (GOOGL,GOOG) shares quickly dropped more than 5% on Wednesday morning following a Bloomberg report that Apple (AAPL) is exploring adding AI search to its browsing services.

Apple senior vice president of services Eddy Cue said the company is “actively looking at” bringing AI powered search to its Safari browser during a testimony in the US Justice Department’s lawsuit against Alphabet, according to Bloomberg.

Apple stock was down about 2% following the disclosure.

Stock futures popped Tuesday night on news that Treasury Secretary Scott Bessent will be meeting with Chinese officials this weekend.

While speaking before the House Committee on Financial Services on Wednesday (watch live here), Bessent clarified that the talks with China are not “advanced” but rather just the beginning of discussions.

Yahoo Finance’s Ben Werschkul reports:

Read more here.

Disney (DIS) just revealed plans for a new theme park in the Middle East.

The media and entertainment giant said Wednesday that the new theme park and resort would be located in Abu Dhabi, United Arab Emirates (UAE), marking its first major expansion into the Middle East and its seventh global resort. This announcement comes 15 years after Disney’s last park project, Disneyland Shanghai, was unveiled in 2010.

The project supports Disney’s broader strategy to invest $60 billion into its theme parks and cruise lines by 2033, including approximately $30 billion already earmarked for expansions in Florida and California.

The Abu Dhabi resort will be developed in partnership with Miral, the state-backed tourism and real estate firm behind many of the UAE’s landmark attractions.

“We are celebrating another great moment in our storied history,” Disney CEO Bob Iger said during the company’s Q2 earnings call Wednesday morning, describing the project as “authentically Disney and distinctly Emirati.”

The announcement comes after the company reported strong second quarter earnings results, driven by a rebound in its domestic parks business and solid performance in its streaming unit. The company also boosted its full-year earnings outlook, sending shares about 10% higher in early trade.

Read more here.

US stocks coasted higher on Wednesday as investors assessed prospects for planned US-China trade talks and waited for the Federal Reserve’s latest interest-rate decision to land.

The benchmark S&P 500 (^GSPC) rose about 0.2%, while the Dow Jones Industrial Average (^DJI) popped roughly 0.5%, or almost 200 points. The tech-heavy Nasdaq Composite (^IXIC) inched higher by 0.1%.

Yahoo Finance’s Josh Schafer writes about how April’s solid jobs report may be masking underlying weakness in the economy:

Read more here.

Yahoo Finance’s Hamza Shaban writes in today’s Morning Brief newsletter about how both the Federal Reserve and President Trump are on pause.

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Super Micro Computer (SMCI) stock fell nearly 6% in premarket trading on Wednesday after the company lowered its full-year revenue outlook, citing economic uncertainty amid President Trump’s trade war and fierce competition from other AI server makers.

Super Micro said on Tuesday that it expects its full-year revenue for 2025 to fall between $21.8 billion and $22.6 billion, down from its prior guidance of $23.5 billion and $25 billion.

CEO Charles Liang told analysts in a call following the company’s third quarter earnings results that tariffs and macroeconomic uncertainty “concern” some customers and make it difficult to forecast the adoption of its technology.

Super Micro’s servers contain Nvidia’s (NVDA) AI chips and are used in data centers to power artificial intelligence.

As of Tuesday’s close, Super Micro shares were down nearly 39% in 2025. The stock has plunged as investors weigh the company’s AI-fueled growth against questionable accounting practices, growing competition, and macroeconomic uncertainties.

Read the latest story here.

Disney’s (DIS) shares climbed over 6% early on Wednesday as investors cheered a quarterly earnings beat and a boost to its full-year profit forecast.

Yahoo Finance’s Alexandra Canal reports:

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Uber (UBER) stock fell 3% in premarket trading on Wednesday after the company reported revenue rose 14% to $11.53 billion in the first quarter, below Wall Street’s estimates.

However, Uber sees resilient demand for ride-hailing and food delivery in the current quarter and forecast higher gross bookings.

Yahoo Finance’s Pras Subramanian reports:

Read more here.