Before the bell: cautious Fed slashes end-of-year rally

The U.S. Federal Reserve’s cautious outlook has spooked investors. Micron Technology remains wary, and Ulta Beauty introduces makeup for children.

As expected, the Federal Reserve reduced interest rates by 0.25% yesterday. However, policymakers signaled only two rate cuts for 2025, which rattled Wall Street. The S&P 500 plummeted 3%, while the Nasdaq dropped 3.6%. European markets had already closed by then. The Bel20 and Euro Stoxx 50 both gained 0.3% earlier in the day. Proximus saw a 4.3% rise, with its subsidiary Proximus Global valued at 3.1 billion euros, compared to the parent company’s modest market value of 1.7 billion euros. Despite this uptick, Proximus shares remain down by over 40% for the year.

This morning, Asia’s Hang Seng Index and Topix declined by 0.6% and 0.2%, respectively. The Bank of Japan left its interest rates unchanged. In Belgium, the December consumer confidence survey results are expected today. Interest rate decisions from Norway, Sweden, the Czech Republic, and the U.K. are also on the agenda. In the U.S., Accenture will report earnings before the market opens, followed by Nike and FedEx after-hours.

No AI worries

Micron Technology, the American memory chip manufacturer, reported a quarterly revenue of 8.7 billion dollars, an 84% increase compared to the same period last year. Earnings per share reached 1.79 dollars, slightly exceeding analysts’ expectations of 1.76 dollars. Despite strong figures, the company’s forward guidance disappointed, sending shares over 16% lower in after-hours trading. The lackluster outlook stems from weakness in the PC and smartphone markets. However, Micron emphasized that its AI-related chip sales have grown substantially and will continue to meet robust demand.

Starting young

Beauty retailer Ulta Beauty has ventured into makeup for children—not real cosmetics, but miniature replicas of its popular products. These are cleverly packaged in surprise balls, created in collaboration with Chinese company Zuru. The collection features 68 different balls, each costing 10 dollars, aimed at introducing children to Ulta’s beauty products early. The strategy seems effective; the collectible balls are frequently sold out and have become viral hits on TikTok and YouTube. While many parents enjoy the novelty, some and even dermatologists have voiced concerns. Whether these children grow into loyal Ulta Beauty customers remains to be seen.

Did you know…

that the operator of Brazilian stock markets, B3, is scrutinizing the share price of waste management company Ambipar. Its stock has soared more than 1130% this year, likely due to a short squeeze triggered by recent purchases from the company’s founder.

This article was translated from Dutch and was originally published on Spaarvarkens.be.