Stock Market Falls Ahead of Fed Meeting as Iran Crisis and AI Worries Deepen

Global stock markets showed signs of strain early Wednesday as geopolitical tension and doubts about the artificial intelligence boom unsettled investors ahead of a crucial U.S. Federal Reserve decision.

Asian markets opened uneven. A key regional index tracking shares outside Japan slipped 0.2%, pulling back for a second straight day after hitting record highs earlier in the week. Losses in Taiwanese chipmakers drove much of the decline, while Japanese markets remained closed for a holiday.

Futures tied to the S&P 500 edged slightly higher, but sentiment stayed fragile. Oil prices climbed, with Brent crude rising to $111.71 per barrel as efforts to resolve the Iran conflict stalled.

Analysts pointed to a breakdown in negotiations. “Markets remained cautious overnight as peace talks continued to stall, with Iran seeking the lifting of the U.S. naval blockade of the Strait of Hormuz and mediators expecting a revised Iranian proposal in coming days,” analysts from Westpac wrote.

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