Bespoke Investment Group co-founder Paul Hickey shared his insights on CNBC's "Closing Bell: Overtime," highlighting the anticipation surrounding the Federal Reserve's impending interest rate decision. Investors are eagerly waiting for Wednesday's announcement, which is anticipated to be a pivotal moment in the financial markets. Following the decision, Fed Chair Jerome Powell will hold a press conference where investors will scrutinize his remarks for any hints about future monetary policy directions. Despite the attention, market analysts expect the decision to be largely uneventful.
The first Federal Reserve interest rate decision of 2025 appears to carry little suspense, as Fed funds futures data indicate a near certainty that interest rates will remain unchanged. The central bank is expected to maintain its current target range for interest rates at 4.25%-4.5%. This steady approach aligns with investor expectations, as Hickey noted that minimal intervention from the Fed is viewed positively by market participants.
"When it comes to the Fed, they're widely not expected to do anything tomorrow and that's a good thing. The less the Fed has to do, the better it is for the market, in our view." – Hickey
On Tuesday, stock futures experienced slight declines as investors braced for the Fed's announcement. The Dow Jones Industrial Average futures ticked down 23 points, a marginal decrease of 0.05%, while another update showed a dip of 28 points or 0.06%. Similarly, Nasdaq 100 futures pulled back by 0.1%, mirroring the movement in S&P 500 futures.
Despite these minor fluctuations, tech stocks provided a boost during regular trading on Tuesday, with the Nasdaq Composite gaining a notable 2%. Nvidia, a major player in the tech sector, surged nearly 9% after experiencing a significant decline of 17% on Monday, reflecting the volatility within the market.
The broader market sentiment remains cautiously optimistic, with hopes pinned on a non-event outcome from the Fed's interest rate decision. Hickey emphasized that recent developments have had limited impact on market-wide dynamics.
"As far as the DeepSeek news over the weekend, at the end of the day today, there really hasn't been that much of an impact on a market wide basis." – Bespoke Investment Group co-founder Paul Hickey