Market Wrap | Federal Reserve Cuts Rates Amid Economic Uncertainty

On September 17, 2025, the Federal Reserve cut its benchmark interest rate by 25 basis points to 4.00%-4.25%, marking a resumption of rate cuts since December last year. Fed Chair Jerome Powell emphasized that the labor market's risks were a key focus in today's decision, highlighting potential impacts from possible tariff increases. These developments reflect ongoing concerns about economic slowing and inflation dynamics. Meanwhile, the S&P 500 index fell 0.10%, the Dow Jones Industrial Average rose 0.57%, and the Nasdaq Composite index declined 0.33%.

Based on the day's market performance, the technology sector, non-essential consumer goods sector, and industrial sector underperformed the S&P 500. Conversely, the utilities sector, healthcare sector, essential consumer goods sector, energy sector, communication services sector, materials sector, and financial sector all saw gains despite the overall market trend.

The U.S. Federal Reserve has lowered the benchmark interest rate by 25 basis points to 4.00%-4.25%, resuming the rate cut cycle that was paused since last December. This decision aligns with market expectations and indicates a shift towards more neutral policy direction. Fed Chair Jerome Powell emphasized the importance of the labor market risks in policy decisions and expressed uncertainty about the impact of this rate cut, suggesting the need to examine overall rate trends. Meanwhile, Alibaba has announced strategic investments and financial maneuvers, including completing a $32 billion zero-coupon convertible bond issuance. The company’s stock continues to perform well, marking significant gains year-to-date. Additionally, Microsoft plans to invest over $30 billion in the UK over the next four years, further expanding its data center infrastructure and AI labs.