Investing.com — U.S. stocks slipped lower Tuesday, with investors cautious at the start of the latest Federal Reserve meeting and ahead of the release of key inflation data later in the week.
By 06:05 ET (10:05 GMT), the fell 250 points, or 0.6%, the dropped 20 points, or 0.4%, lower and the slipped 30 points, or 0.2%.
Fed starts June meeting
The starts its latest two-day policy-setting meeting Tuesday, prompting a degree of caution in the stock markets.
The U.S. central bank is widely expected to leave interest rates on hold at a more than two-decade high of 5.25% to 5.5% on Wednesday, with several officials having recently suggested that they need further evidence the pace of inflation is cooling back down to their 2% target level before beginning to lower rates.
Of more interest is likely to be the subsequent press conference from Fed Chair as well as the revelation of the bank’s latest “dot plot”, which outlines how officials expect borrowing costs to evolve in the future.
The FOMC predicted three interest rate cuts this year when its forecasts were last released, but policymakers are likely to have lowered the number of cuts they now see.
US CPI release due
The economic data slate is quiet Tuesday, but Wednesday also sees the release of the May reading of its U.S. , a highly-anticipated gauge of inflation in the world’s largest economy.
Further signs of inflation easing could cement expectations for rate cuts, especially given signs of economic weakness, but a bad inflation miss could spook investors and bring back recession fears that have laid dormant for months.
Apple announces OpenAI partnership
In the corporate sector, earnings are due from the likes of Oracle (NYSE:) and Rubrik (NYSE:) after the bell, but Apple (NASDAQ:) is in the spotlight after the iPhone maker announced a partnership with OpenAI that will see it fold the start-up’s ChatGPT chatbot into its products.
The agreement, which was revealed at Apple’s annual developers conference on Monday, comes as the tech giant looks to enhance its artificial intelligence capabilities following an intensifying surge in enthusiasm around the nascent technology.
Elsewhere, General Motors (NYSE:) stock rose 1.2% after the auto giant’s board authorized a fresh $6 billion stock repurchase plan, and Eli Lilly (NYSE:) stock rose 1% after its Alzheimer’s drug donanemab received unanimous backing from an FDA panel.
Crude steady ahead of API data
Oil prices steadied Tuesday, as traders geared up for the Fed decision and fresh U.S. inflation figures.
At 09:35 ET, rose 0.2% to $81.77 per barrel, while West Texas Intermediate crude futures climbed 0.1% to $77.83 per barrel.
Prices had touched a one-week high on Monday on hopes of rising demand over the key summer travel period in the U.S., although analysts noted that the positioning was likely overly optimistic.
The is set to release its estimate of weekly stockpiles later in the session.