Tonight's Highlights | Oil Surges on Hotter PPI; U.S. Futures Slump Ahead of Fed Decision
U.S. equity index futures fell across the board on Wednesday as traders awaited the Federal Reserve's interest rate resolution. Major European indices mostly tracked lower.
U.S. President Donald Trump stated via social media on Wednesday that the U.S. is considering further strikes against the current Iranian regime, asserting that security responsibilities for the Strait of Hormuz should be borne by the nations reliant on its shipping lanes, rather than the United States.
Brent crude prices surged 4% to approximately $103.5 per barrel during the session. The rally followed reports that Iranian petrochemical facilities at South Pars were targeted in U.S. and Israeli strikes.
Pre-market data revealed a significant upside surprise in inflationary pressure:
- February PPI: Increased 3.4% YoY (Exp: 2.9%; Prev: 2.9%) and 0.7% MoM (Exp: 0.3%; Prev: 0.5%).
- February Core PPI: Increased 3.9% YoY (Exp: 3.7%; Prev: 3.6%) and 0.5% MoM (Exp: 0.3%; Prev: 0.8%).
Investors are closely monitoring the upcoming FOMC rate decision. The market widely expects the Fed to maintain the federal funds rate within the 3.5% to 3.75% range. Traders will focus on whether Chairman Jerome Powell—in his penultimate meeting—provides guidance on the impact of soaring oil prices on future monetary policy.
Anthony Saglimbene, Chief Market Strategist at Ameriprise Financial, noted: "The market remains cautious against the backdrop of the Fed decision and elevated oil prices. While the Fed will likely hold steady, investors will watch how policymakers interpret the impact of the Iran conflict within the context of inflation risks and growth prospects."
Corporate News
Samsung and AMD Deepen Strategic Ties; Eye HBM4 Supply and Foundry Collaboration
Samsung Electronics and AMD signed a Memorandum of Understanding (MoU) on Wednesday (March 18) to expand their strategic collaboration in AI infrastructure memory. The agreement focuses on supplying Samsung’s next-generation HBM4 for AMD’s upcoming Instinct MI455X AI accelerators and optimized DDR5 for 6th Gen EPYC processors.
The firms are also exploring foundry opportunities, where Samsung may provide contract manufacturing services for AMD’s next-gen products.
Microsoft Weighs Legal Action Over $50B Amazon-OpenAI Cloud Deal
Microsoft is reportedly considering legal action against Amazon and OpenAI over a $50 billion deal that may breach Microsoft’s exclusive cloud partnership. The dispute centers on whether Amazon Web Services (AWS) can host OpenAI’s Frontier platform without violating an agreement that mandates all model access go through Microsoft Azure. Negotiations are ongoing to resolve the conflict without litigation.
Amazon Plans Massive Cuts to USPS Parcel Volume
Amazon is reportedly planning to slash the volume of packages it sends via the U.S. Postal Service (USPS), a move that could cost the agency millions in lost revenue. The e-commerce giant aims to cut its shipping volume by at least two-thirds before its contract with USPS expires this fall.
Samsung Eyes Multi-Year Chip Contracts to Stabilize Memory Market
Samsung Co-CEO Young Hyun Jun told shareholders the company is considering switching from traditional annual or quarterly contracts to multi-year supply agreements. The shift is intended to provide greater stability to the volatile memory chip market.
BASF to Raise Prices in Europe for Home Care and Industrial Segments
BASF announced on March 18 that it will raise prices for all products in its home care, industrial & institutional cleaning, and industrial formulators segments in Europe. Price hikes are expected to reach 30% or more.