AMZN Amazon.com Inc

The major U.S. index futures are currently pointing to a lower open on Wednesday, with stocks likely to see further downside following the sell-off seen over the course of the previous session.

Concerns about the outlook for interest rates may continue to weigh on the markets ahead of the Federal Reserve’s monetary policy announcement this afternoon.

While the Fed is widely expected to leave rates unchanged, traders will pay close to the wording of the accompanying statement along with Fed Chair Jerome Powell’s post-meeting press conference.

“Yesterday’s late selloff characterized a shift in the market’s mindset from hopes of monetary accommodation to acceptance that higher rates will persist,” said John Lynch, Chief Investment Officer for Comerica Wealth Management.

“Consequently, today’s big news will likely come from Treasury’s refunding announcement rather than the FOMC,” he added. “Any signs of increased liquidity should enable economic demand, and risk assets, to regain their footing.”

Despite the downward momentum for the broader markets, shares of Amazon (NASDAQ:AMZN) are likely to see initial strength after the online retail giant reported better than expected first quarter results.

Stock prices went down south on Wall Street on Tuesday, sliding lower and lower after a weak start, as concerns about inflation and uncertainty about the Fed’s interest rate moves rendered the mood bearish.

Investors digested a mixed batch of earnings updates and some disappointing economic data.

The major averages all ended sharply lower, with the Nasdaq suffering a more pronounced loss. The Dow ended down by 570.17 points or 1.5 percent at 37,815.92. The S&P 500 dropped 80.48 points or 1.6 percent to 5,035.69, while the Nasdaq tumbled 325.26 points or 2.0 percent to settle at 15,657.82.

A report from MNI Indicators showed Chicago-area business unexpectedly contracted at an accelerated rate in the month of April.

The report said the Chicago business barometer dropped to 37.9 in April from 41.4 in March, with a reading below 50 indicating contraction. Economists had expected the index to rise to 44.9.

With the unexpected decrease, the Chicago business barometer fell to its lowest level since November 2022.

A separate report released by the Conference Board showed consumer confidence in the U.S. deteriorated by much more than expected in the month of April.

The Conference Board said its consumer confidence index slid to 97.0 in April from a downwardly revised 103.1 in March. Economists had expected the index to dip to 140.0 from the 104.7 originally reported for the previous month.

Meanwhile, data from the Labor Department showed labor costs in the U.S. rose more than expected last quarter, up by 1.2 percent, indicating a rise in wage pressures.

Microsoft Corporation shares dropped about 3.2 percent. Amazon ended down by 3.3 percent. Apple Inc., NVIDIA Corporation, Alphabet, Meta Platforms, JP Morgan Chase, Oracle, Chevron, Bank of America, Exxon Mobil, Visa Inc and Walmart ended with sharp to moderate losses.

Eli Lilly shares rallied nearly 6 percent after the company reported stronger than expected quarterly earnings. 3M also surged higher after reporting strong first quarter earnings.

PayPal shares climbed higher after the company said its total payment volume in the first quarter rose by 14% to $403.9 billion.

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