Markets retreat as Fed holds rates steady and Iran hits key Qatar gas hub

Hello, this is Dylan writing to you from Singapore. Welcome to another edition of CNBC’s Daily Open.

US markets fell sharply on Wednesday as inflation data and Fed signals weighed on Iran. However, there were some bullish AI signs.

The Dow Jones Industrial Average fell more than 750 points to a new low for the year on Wednesday, with the index on pace for its worst month since 2022.

That came after the Federal Reserve stabilized rates. Policymakers pointed to inflation concerns and uncertain consequences amid the Iran war, prompting hopes of swift cuts.

Meanwhile, Fed Chair Jerome Powell says he will serve as central bank chief unless his nominated successor, Kevin Warsh, is confirmed in May.

While the Fed will continue to monitor factors such as energy prices, Iranian missiles on Wednesday caused extensive damage to Qatar’s Ras Laffan natural gas facility, further threatening fuel supply disruptions.

In an effort to stabilize oil markets, President Donald Trump issued a 60-day waiver of the Jones Act — a long-standing shipping law that restricts American ships from transporting cargo between US ports.

Gas prices aren’t the only ones going up; Memory chip prices are also rising amid intense AI demand. It nearly tripled American memory chipmaker Micron’s revenue in the most recent quarter.

Demand for artificial intelligence is boosting companies in China, with tech giant Tencent reporting full-year revenue topping analyst forecasts as it ramps up AI investments.

In another bullish sign for AI in China, policymakers and tech companies are pushing for widespread adoption of open source AI agent OpenClaw. Amid market excitement for OpenClaw, shares of some of China’s “AI tigers” rose on Wednesday.

– Dylan Butts