Broadcom $63B Chip Deal Boosts Tech Ahead of Fed Decision and Earnings

U.S. stock futures were mostly unchanged as investors awaited Federal Reserve interest rate decisions and mega-cap technology company earnings. On Tuesday, Broadcom announced a $63 billion bank financing deal to lease its chips and networking solutions to AI company Anthropic, which helped boost chip stocks. Broadcom rose 4%, Advanced Micro Devices increased 5.5%, and Micron Technology went up 2.8%, contributing to a 1.2% gain in the Nasdaq Composite.

Oil prices fell after a meeting between Iran's Supreme Leader and top security officials discussing conditions to end the U.S. conflict. The Federal Reserve is widely expected to keep interest rates steady at 3.75% to 4%. The announcement is scheduled for 2:00 p.m. ET on Wednesday, with a 92% probability of no change. However, some analysts expect signals of future rate hikes. Following the Fed decision, investors will focus on earnings from major AI-exposed technology companies Alphabet and Microsoft, marking the start of Big Tech earnings season.

This matters because the $63 billion Broadcom financing deal signals strong investment in AI-related technology, potentially supporting tech sector gains. The Fed's interest rate decision will influence borrowing costs and market liquidity, impacting future stock valuations. The upcoming tech earnings reports will provide insights on AI sector performance, affecting investor allocations in tech stocks such as Broadcom (AVGO), AMD, and others.