[New York Stock Market] Pause Ahead of CPI Release and FOMC... Coinbase Down 12%

Nasdaq Rises 0.36%

The three major indices of the U.S. New York Stock Exchange closed slightly higher on the 6th (local time). The market is taking a breather ahead of the Consumer Price Index (CPI) announcement and the Federal Reserve's (Fed) monetary policy meeting scheduled for mid-month. The S&P 500 index closed at its highest level of the year.

On this day in the New York Stock Exchange, the Dow Jones Industrial Average rose 0.03% compared to the previous trading day. The large-cap-focused S&P 500 index increased by 0.24%, and the tech-heavy Nasdaq index rose 0.36% to close the session. The S&P 500 index set a new closing high for the year.

Jeff Kilburg, CEO of KKM Financial, said, "The market is trying to avoid major volatility as it awaits next week's Fed meeting," adding, "It is important to note that the market has exceeded the upper range of stock prices over the past few months." He further analyzed, "The market seems to be in a consolidation phase. Investors are taking a breather ahead of next week's Fed meeting."

The slight rise in the stock market was driven by a weakening outlook for a U.S. recession. On this day, the World Bank (WB) forecasted a global economic slowdown this year, projecting an economic growth rate of 2.1%. This is 1 percentage point lower than last year's growth rate but represents a 0.4 percentage point upward revision compared to the 1.7% growth forecast released in January. Notably, the U.S. growth rate was revised up from 0.5% to 1.1%.

By individual stocks, the U.S. Securities and Exchange Commission (SEC) abruptly filed a lawsuit against cryptocurrency exchange Coinbase Global, causing the company's stock to plunge more than 12%. The SEC viewed Coinbase Global as operating an unregistered brokerage. Meanwhile, Bitcoin surged more than 6%.

Apple fell 0.2%. Although it unveiled the mixed reality (MR) headset 'Vision Pro' at the annual Worldwide Developers Conference (WWDC), investors appeared to have already priced it into the stock. Prior to the WWDC opening, Apple shares had risen to an all-time high but declined for two consecutive days following the Vision Pro announcement.

Market uncertainty is expected to continue ahead of next week's FOMC meeting. Experts are closely watching the Fed's stance and future economic outlook.

Paul Nolte, strategist at Murphy & Silbey, said, "The market is on pause until the Fed meeting and inflation data are confirmed," adding, "Investors are wrestling with the difference between a pause and a hike at the next meeting and the impact of those options."

There is also a forecast that the Fed will not cut rates for the time being. Chris Senek, analyst at Wolfe Research, stated, "Due to a small-scale crisis at regional banks, overall financial conditions have eased moderately," and added, "Sticky inflation is the core reason why we expect the Fed to keep rates 'higher for longer,' which underpins our bearish outlook." He further noted, "We cannot be confident that the Fed has taken appropriate measures to bring inflation down to a sustainably low level."