FX.co ★ US Stocks Inch Lower Ahead of Fed

US equities mostly declined on Wednesday as mounting evidence of higher inflation deepened worries that surging energy prices could lead to stagflation. The S&P 500, Dow, and Nasdaq 100 each traded up to 0.3% lower.

Both headline and core producer price inflation for February came in well above expectations, underscoring cost pressures that predate this month’s spike in energy prices following the Persian Gulf supply shock. These pro‑inflationary developments are expected to be reflected in the Federal Open Market Committee’s updated economic projections, which are due today alongside a widely anticipated decision to keep interest rates on hold.

Most sectors traded broadly lower as rising Treasury yields weighed on corporate credit conditions. Mega-cap technology names were weaker, with Amazon, Microsoft, Meta, and Oracle each down more than 0.5%. Consumer defensives underperformed, led by Procter & Gamble, which fell 1.5%. By contrast, Micron gained nearly 1% ahead of its earnings report after the closing bell.