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Fed Rate Hike Nears End: A Pause in Tightening Cycle Expected

This week in finance, the Fed hints at a pause in rate hikes, PacWest Bank seeks a lifeline, Apple's earnings anticipate a massive share buyback, Shell posts better-than-expected Q1 income, and the ECB may ease monetary policy tightening.

Jerome Powell
Jerome Powell

The Federal Reserve signals a possible end to its year-long rate hiking campaign, with Federal Reserve Chair Jerome Powell stating that a pause could soon occur. Observers noticed a "meaningful" change in the Federal Open Market Committee's outlook, with the guidance revised to consider new data and the overall effect of elevated rates.

Struggling PacWest Bank Seeks Financial Lifeline

Beverly Hills-based PacWest Bancorp teeters on the edge of collapse, with the bank reporting discussions with potential partners and investors to secure a financial lifeline. The bank's issues diminish hopes that JPMorgan's recent emergency acquisition of First Republic could stem the crisis in the U.S. banking industry.

Apple Earnings: Drop in Sales but Massive Share Buyback Expected

U.S. stock futures remain subdued as investors digest the Fed decision and turmoil in regional banks. Apple's upcoming earnings report is expected to show a drop in sales for the second quarter in a row. Still, the company is also anticipated to unveil a massive increase in its share buyback program, potentially worth $90 billion.

Shell Reports Better-Than-Expected Q1 Income

Royal Dutch Shell's first-quarter income exceeded expectations, with a 5.7% increase compared to last year. Strong fuel trading performance and a bumper quarter for its chemicals and refined products division contributed to the results. Shell's maintained pace of share buybacks is seen as a key factor in closing the valuation gap between Shell and its U.S. peers.

ECB Decision Day: Will Monetary Policy Tightening Ease?

The European Central Bank (ECB) is expected to increase interest rates at its latest governing council meeting. However, recent inflation and lending data may lead the ECB to adopt a more dovish approach and gradually ease off on its monetary policy tightening cycle.