[New York Stock Market] Technology Stocks Decline Together for the First Time in Three Days... Continued Caution over FOMC and Tariffs

Tesla Plunges Over 5% After Investment Bank Lowers Target Price
Big Tech Weakness Ends Two-Day Rally, Market Turns Lower
Focus on FOMC Meeting on the 19th... Dot Plot in the Spotlight
U.S. and Russia Agree on Partial Ceasefire in Ukraine War, Oil Prices Fall

The three major indices of the U.S. New York stock market all closed lower on the 18th (local time). The recent two-day upward trend halted as stock prices fell sharply, centered on large tech stocks including U.S. electric vehicle maker Tesla. Amid ongoing concerns about tariff policy uncertainties, investors are awaiting the Federal Reserve's (Fed) interest rate decision and the release of the dot plot the following day. International oil prices fell after the leaders of the U.S. and Russia agreed on a partial ceasefire related to the Ukraine war.

AFP Yonhap News

On this day in the New York stock market, the blue-chip-focused Dow Jones Industrial Average (Dow) closed at 41,581.31, down 260.32 points (0.62%) from the previous trading day. The large-cap-focused S&P 500 index fell 60.45 points (1.06%) to 5,614.66, and the tech-heavy Nasdaq index slid 304.54 points (1.71%) to close at 17,504.12.

By individual stocks, U.S. electric vehicle maker Tesla plunged 5.34% after RBC Capital Markets lowered its target price. AI leader Nvidia dropped 3.43%. Alphabet, Google's parent company, fell 2.34% after agreeing to acquire cybersecurity firm Wiz for $32 billion (approximately 46.5 trillion KRW).

Investors are focusing on the two-day FOMC regular meeting starting today. According to the Chicago Mercantile Exchange (CME) FedWatch, Wall Street expects with a 99% probability that the Fed will keep the benchmark interest rate unchanged at 4.25-4.5% on the 19th. The key point is the Fed's dot plot reflecting interest rate forecasts. Previously, in December last year, the Fed reduced the expected number of rate cuts in 2025 from four times (total 1.0 percentage point) to two times (total 0.5 percentage point), each by 0.25 percentage points. The focus now is whether the Fed will emphasize inflation concerns and hawkishly reduce this year's rate cut forecast to once, or highlight recession worries and dovishly increase it to three times. Experts expect the Fed to maintain the forecast of two rate cuts this year as before.

Attention was also drawn to the phone call between the U.S. and Russian leaders. U.S. President Donald Trump and Russian President Vladimir Putin agreed after the call to suspend attacks on energy facilities for 30 days in relation to the Ukraine war. President Putin had previously rejected the '30-day full ceasefire plan' agreed upon by the U.S. and Ukraine. He instead proposed that the U.S. and other foreign countries stop providing weapons and intelligence support to Ukraine as a condition for a full ceasefire.

Concerns about tariff policy also remain widespread in the market. U.S. Treasury Secretary Scott Vestin said in an interview with Fox News that "on April 2, each country will receive numbers representing tariffs," adding, "some countries will have very low tariffs, and some will have very high tariffs." Regarding fears of a recession caused by tariff shocks, he said, "The indicators are very good, so there is no reason to experience a recession," but also noted, "nothing can be guaranteed."

Rice Williams, Chief Investment Officer (CIO) of Wave Capital, said, "The market seems to want to return not only to the good times of the past few years but also to the times when things did not go well," and predicted, "Market volatility will continue until the tariff decision on April 2."

Jay Woods, Senior Global Strategist at Freedom Capital Market, analyzed, "The tariffs the Trump administration is pushing to implement and the ongoing trade tensions have brought significant uncertainty," adding, "Investors want to know how these policies will affect the Fed's economic outlook, especially inflation and growth forecasts."

Government bond yields showed a slight decline. The 10-year U.S. Treasury yield, a global bond yield benchmark, fell 2 basis points (1bp = 0.01 percentage point) from the previous day to 4.28%, while the 2-year U.S. Treasury yield, sensitive to monetary policy, remained steady at 4.04%.

International oil prices fell after the U.S. and Russian leaders agreed to suspend attacks on energy facilities for 30 days in the Ukraine war. West Texas Intermediate (WTI) crude oil closed at $66.90 per barrel, down $0.68 (1.0%) from the previous day, and Brent crude, the global oil price benchmark, ended at $70.56 per barrel, down $0.51 (0.7%) from the previous day.