CNBC Daily Open: A 'hawkish cut' by the Fed could dull festivities
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Taken from CNBC’s Daily Open, our international markets newsletter — Subscribe today On Wednesday stateside, the U.S. Federal Reserve is widely expected to lower its benchmark interest rates by a quarter percentage point to a range of 3.5%-3.75%.However, given that traders are all but certain that the cut will happen — an 88.6% chance, to be exact, according to the CME FedWatch tool — the news is likely already priced into stocks by the market. That means any whiff of restraint could weigh on equities. In fact, the talk in the markets is that the Fed might deliver a "hawkish cut": lower rates while suggesting it could be a while before it cuts again.The "dot plot," or a projection of where Fed officials think interest rates will end up over the next few years, will be the clearest signal of any hawkishness. Investors will also parse Chair Jerome Powell's press conference and central bankers' estimates for U.S. economic growth and inflation to gauge the Fed's future rate path.In other words, the Fed could rein in market sentiment even if it cuts rates. Perhaps end-of-year festivities might be muted this year.U.S. stocks were mixed Tuesday. The S&P 500 remained largely unchanged and the Dow Jones Industrial Average dropped 0.38%, but the Nasdaq Composite added 0.13%. The Russell 2000 hit an intraday high. Over in Europe, the regional Stoxx 600 ended flat. The Fed is expected to cut rates on Wednesday. But the decision might not be unanimous, implying that further easing could be put on a pause. Fed officials will also update their "dot plot," showcasing interest rate expectations.Vietnam's stock market has been surging. The VanEck Vietnam ETF (VNM) has soared roughly 62% year to date, thanks to domestic reforms and trade developments. And the country could continue its upward trajectory, analysts say.U.S. changes timeline for China's purchases of soybeans. Following an NBC News report that soybean purchases by China are far from reaching the 12 million metric tons target by the end of the year, Greer said the finish line was the end of the "growing season."[PRO] Will China sales lift Nvidia stock? While market reaction to news that U.S.
President Donald Trump has allowed the chipmaker to sell more advanced chips to Beijing was muted, analysts are more optimistic about the development.Nvidia can sell the more advanced H200 AI chip to China — but will Beijing want them?The H200 is one of Nvidia's most advanced chips for training and running AI, but China has been on a drive to wean itself off American technology and boost local semiconductor development.But while China held off on H20 purchases, the H200 is far more advanced than its predecessor, which could tempt Beijing. Meanwhile, Alibaba CEO Eddie Wu said there were supply shortages across the entire semiconductor supply chain.— Arjun KharpalGot a confidential news tip? We want to hear from you.Sign up for free newsletters and get more CNBC delivered to your inboxGet this delivered to your inbox, and more info about our products and services.© 2025 Versant Media, LLC.
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