La Federal Reserve he decided to leave interest rates unchanged, ignoring the pressures of Donald Trump which called for a more expansionary monetary policy to stimulate the economy. The choice, widely expected by the markets, was justified by inflation that remains "a little high" despite a robust labor market, with unemployment at historic lows. The target for the Fed Funds remains between 4,25% and 4,5%“We are in no rush to change our stance,” Chairman Jerome Powell said at a press conference, adding that any action would depend on further progress on inflation.
Today it will be up to the ECB which will likely cut rates in its first announcement of 2025. Meanwhile, the European stocks expected to open higher: EuroStoxx50 index futures +0,3%.
Powell Ignores Trump: 'Independent of Political Pressure'
Fed Chairman Jerome Powell has remained firm and detached from Trump's criticism. "I will not comment on what the President has said," he said, reiterating that the Fed will continue to work in a independent, based on the personal data and on economic risks. On the policies announced by Trump, Powell chose caution: "Tariffs, immigration and other measures will have effects on the economy that we will evaluate only when they are clearer". However, the presidential statements on tariffs have already fueled inflationary expectations, although considered "transitory".
However, some difficulties are beginning to emerge: sectors such as construction, are starting to report labor shortages, due to the reduction in the immigrant workforce. Powell, however, downplayed: "For now, the problem remains limited". The Fed's number one has ruled out contacts with Trump and reaffirmed thecentral bank independence, explaining that “too fast a change could hinder progress on inflation, while too slow a change could damage jobs and the economy”.
Powell also indicated that the recent rise in long-term yields could reflect a tightening of financial conditions.
Trump Attacks: Fed 'Failed' to Fight Inflation
La Trump's reaction was not long in coming. The former president accused the Fed of “failing to stop inflation.” “I’ll do it,” he said, listing his solutions: fewer rules, more American energy, rebalancing trade, and boosting manufacturing. Trump also criticized the Fed for focusing on “false problems” like diversity and climate change, arguing that these choices have exacerbated inflation, “the worst in the history of our country.”
Wall Street and Quarterly Results: Lights and Shadows
The Fed's decision has affected the mood of Wall Street, which closed lower. TheS & P 500 lost 0,5%, with theNasdaq index down 0,8% and the Dow Jones of 0,31%. The new decline is significant Nvidia (-4%). However, US stock futures turned higher after the release of the Big Tech Quarterly Reports:
- ecosystem closed the quarter with revenues up 12% to $69,6 billion, beating expectations (68,92 billion), and net income up 10% to $24,1 billion. However, the cloud segment disappointed: revenues (+21%) stopped at $40,9 billion, below the forecast of $41,1 billion, causing the stock to fall 4,63% in after-hours trading.
- Meta (Facebook) closed the fourth quarter of 2024 with a 21% jump in revenue, reaching 48,39 billion, with net profit up 49% (20,83 billion). The advertising boom – +10% in ad prices and +11% in impressions – reassured Zuckerberg, but the expected 50% increase in spending for 2025 (up to 65 billion) to strengthen artificial intelligence leaves some uncertainty. The stock gained more than 2% in after-hours trading.
- Tesla, however, disappointed expectations. The profit margin fell to 13,59% (from 17,05%) and revenue stopped at 25,71 billion, below the estimates of 27,27 billion. Earnings per share (73 cents) were also lower than the 76 expected. Despite this, the stock marked a +4% in after-hours trading. Musk promised a relaunch with new economic models, the Cybertruck and improvements in autonomous driving, but Chinese and European competition is making itself felt.
Asian stocks: Gains and losses in a leopard-like pattern
Meanwhile, the asian bags show mixed signals. Tokyo, Mumbai, e Sydney are recording modest gains (Nikkei +0,25%, BSE Sensex +0,3%, S&ASX200 +0,6%), while Thailand e Indonesia they mark declines.
In the rest of Asia, however, markets are virtually at a standstill. Stock exchanges Shanghai, Shenzhen, Hong Kong, Taipei e Alone are closed for holidays, leaving the landscape a little calmer. While the West is watching the Fed's moves, in Asia the holiday break is giving way to a calmer reflection on the future.
On the currency front, the yen strengthened against the dollar, moving from 155,3 to 154,6, thanks to expectations of further rate hikes by the Bank of Japan.
Cryptocurrencies on the rise
In the world of cryptocurrencies, the Bitcoin rose 2% to $105.350, helped by Powell’s comments, which opened up the possibility of more crypto-friendly regulation. The Fed chairman said that banks can serve crypto customers, as long as they are prepared to manage the risks, raising hopes for a more stable future for digital assets. But interestingly, under the Trump administration, the cryptocurrency sector has found an unexpected ally, pushing for a more favorable regulatory approach.
Softbank and OpenAI: Japan is betting on artificial intelligence
Not just rates and inflation: in Tokyo, attention is also turned to the world ofartificial intelligence, with Softbank that evaluates a investment of 25 billion dollars in OpenAI. A move that could strengthen Softbank's position as a major player in the advanced technology landscape, but also mark an important chapter in AI innovation.
Stocks under scrutiny at Piazza Affari
At Piazza Affari, among the stocks to keep an eye on:
- Generali aims high with the plan to 2027: earnings per share growing by 8-10% annually, dividends of over 7 billion (+30%) and a buyback of at least 1,5 billion.
- Ps, meanwhile, sees the AA Lovaglio in London to convince the funds, perhaps even Blackrock, of the goodness of the takeover bid on Mediobanca.
- Moncler shines thanks to HSBC, which raises the target price to 73 euros.
- Stellantis benefits from greater EU flexibility on 2025 targets and there is talk of new investments in the automotive sector.
- STMicroelectronics, on the other hand, is suffering: a 27,6% drop in first-quarter revenues is expected, with guidance worse than expected.
