U.S. markets brace for Fed decision as oil slide shifts focus to rates and earnings

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US markets brace for Fed decision

Highlights

Investors await the Fed's first policy decision under Chair Kevin Warsh today at 2 p.m. ET, with bond yields stable and high-yield ETFs offering 4.53% to 8.8%.
Brent and WTI oil futures both trade below $80 a barrel, off 27% in a month, with the S&P Energy Sector down 13% since March 27 and gasoline futures down 21%.
CarMax and Jabil report earnings today after three-month rises of 25% and 45% in their shares, while Amazon, CrowdStrike, and key indexes show mixed momentum and recent declines from highs.

Fed, bonds and oil set Wednesday's agenda

As reported by CNBC, investors are focusing on the first major policy decision from new Federal Reserve Chair Kevin Warsh, with the rate announcement due at 2 p.m. ET and a news conference scheduled for 2:30 p.m.

Going into Wednesday, the U.S. 10-year Treasury note yields 4.43%, while the two-year yield stands at 4.05%. The one-year yield is at 3.84%, the six-month Treasury bill yields 3.8%, the three-month T-bill is at 3.72%, and the one-month T-bill is at 3.63%.

High-yield bond funds are also in focus, with the iShares 0-5 Year High Yield Corporate Bond ETF yielding 6.99%, the iShares iBoxx High Yield Corporate Bond ETF yielding 5.89%, the State Street SPDR Bloomberg High Yield Bond ETF yielding 6.59%, and the Fidelity Corporate Bond ETF yielding 4.53%. The KraneShares Asia Pacific High Income USD Bond ETF yields 8.8%, highlighting higher-income options outside the U.S. with different tax implications.

Oil remains another key market driver. Brent and West Texas Intermediate futures are both below $80 a barrel and are down 27% over the last month, while the S&P Energy Sector is down 13% from its March 27 high and gasoline futures have fallen 21% in a month.

Earnings calendar and sector movers in focus

The pullback in energy comes as major equity benchmarks show mixed momentum. Three-day winning streaks for the Nasdaq Composite, Nasdaq 100 and Russell 2000 have ended, while the Dow Transports are down 10% from their 52-week high, although all major indexes remain above their 50-day and 200-day moving averages.

On the earnings front, CarMax is due to release results in the 6 a.m. hour. Its shares are up almost 25% over three months but remain down 27% from their July 2025 52-week high. Jabil is scheduled to report in the 8 a.m. hour, with the stock up 45% in three months, though it is down 6% from the high it reached on Monday.

Investors are also watching for developments at Amazon Web Services on Wednesday. Amazon shares are up 3.1% over two days, but they are down 9% in June and sit 11.7% below their May 5 high.

Outside the main earnings slate, a SpaceX resupply mission is set to conclude at 8:08 a.m. on the U.S. East Coast with a splashdown off California, while CrowdStrike's annual meeting is also on the radar. CrowdStrike shares are down 13.5% from the June 1 high, but they are still up about 45% in 2026 and 60% over three months.

In our earlier article on inflation protection with TIPS and Series I savings bonds, we explained how these instruments can help preserve purchasing power when consumer prices are rising. We highlighted the role of the Treasury–TIPS breakeven rate in judging whether inflation protection is worth the trade-off, and noted that I bonds offer a defined composite rate but come with limited liquidity and redemption restrictions.

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