Global markets mixed ahead of Fed decision amid trade tensions, China stimulus moves

Global stock markets showed mixed performance on Wednesday as investors awaited the US Federal Reserve’s policy announcement, widely expected to leave interest rates unchanged, despite renewed pressure from former President Donald Trump to cut borrowing costs.In Europe, Germany’s DAX was nearly flat at 23,250.56, while France’s CAC 40 slipped 0.5% to 7,661.64. London’s FTSE 100 fell 0.3% to 8,573.67. Meanwhile, futures for the S&P 500 and Dow Jones Industrial Average each gained around 0.6%.Asian markets saw modest gains following news that the US and China plan to resume trade talks in Switzerland later this week. Hong Kong’s Hang Seng Index initially surged more than 2% after Beijing introduced interest rate cuts and other stimulus measures aimed at mitigating the impact of higher tariffs imposed by Trump on Chinese exports. However, gains were largely subdued by market close.Tokyo’s Nikkei 225 edged down 0.1% to 36,779.66, while the Hang Seng finished just 0.1% higher at 22,691.88. The Shanghai Composite Index rose 0.8% to 3,342.67.According to Lynne Song of ING Economics, the timing of China's economic measures may be linked to the upcoming trade discussions. “This way, the easing won’t be seen as a knee-jerk reaction to tariffs. Policymakers are likely now privy to some of the early data on how the economy is being impacted by the tariff shock,” she said.Still, analysts noted that market reactions were restrained, partly due to a lack of substantial government spending initiatives. “These will help to shore up growth at the margin. But any boost to credit demand will be modest and today’s moves are no substitute for an expansion in fiscal support,” said Julian Evans-Pritchard of Capital Economics.Elsewhere in Asia, Australia’s S&P/ASX 200 rose 0.3% to 8,178.30, and South Korea’s Kospi added 0.6% to close at 2,573.80.On Wall Street, US stocks closed lower Tuesday amid earnings reports showing companies holding back on future profit forecasts due to tariff-related uncertainty. The S&P 500 fell 0.8%, its second consecutive loss after a nine-day winning streak—the longest in over two decades. The Dow dropped 0.9%, and the Nasdaq slid 0.9%.Among major decliners, Palantir Technologies dropped 12% after failing to meet investor expectations, reflecting broader skepticism toward AI-related stocks after significant rallies. Palantir's shares, still near $110, had traded around $20 less than a year ago.Ongoing tariff uncertainty is also dampening consumer confidence and long-term purchasing plans, fueling a surge in imports as businesses rush to beat future tariffs. The US trade deficit hit a record $140.5 billion in March, with the economy shrinking 0.3% in Q1 due to the import surge.Companies like DoorDash are feeling the pinch. The delivery firm’s shares fell 7.4% after reporting revenue below analyst expectations.In bond markets, the yield on the 10-year US Treasury rose to 4.32% from 4.31% a day earlier.Oil prices ticked up, with US benchmark crude adding 54 cents to $59.63 per barrel and Brent crude gaining 44 cents to reach $62.57 per barrel.In currency trading, the dollar strengthened to 143.39 Japanese yen from 142.41 yen, while the euro dipped to $1.1348 from $1.1369.