U.S. markets traded modestly lower before the bell Tuesday and ahead of the first of a two-day Federal Reserve meeting on where to go with interest rates.
Futures for the S&P 500 and Dow Jones industrials both slipped 0.3% in premarket trading, while the technology-heavy Nasdaq fell 0.5%.
Click to Gallery
Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, March 18, 2025. (AP Photo/Ahn Young-joon)
FTSE market information is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
A logo is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
FTSE market information is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
FTSE market information is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
A logo is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
Currency traders react near a screen showing the Korea Composite Stock Price Index (KOSPI) and the foreign exchange rate between U.S. dollar and South Korean won, right, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, March 18, 2025. (AP Photo/Ahn Young-joon)
Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, March 18, 2025. (AP Photo/Ahn Young-joon)
As the Fed prepares to meet Tuesday and Wednesday, the central bank and its chair, Jerome Powell, are faced with an economy that is looking somewhat different than it did at its last meeting just two months ago. Hiring was solid. The economy grew at a solid pace in last year’s final quarter. And inflation, while stubborn, had fallen sharply from its peak more than two years ago.
Now, on-and-off again tariff threats from President Donald Trump and sharp cuts to government spending and jobs have tanked consumer and business confidence, which could weigh on the economy and potentially on what is still a healthy job market.
Stocks have been roiled by worries that Trump’s rat -a- tat announcements on tariffs and other policies are creating so much uncertainty that U.S. households and businesses will hold back on spending, which would hurt the economy.
Fed officials will almost certainly keep their key rate unchanged this week. At the conclusion of the meeting Wednesday, they will release their latest quarterly economic projections, which will likely show they expect to cut benchmark interest rates in the U.S. twice this year.
In equities trading, Tesla faltered again, losing 1.7% before the bell. That follows a 4.8% sell-off the day before on news that China’s energy and auto giant BYD announced an ultra fast EV charging system that it says is nearly as quick as a gas fill up.
Crude prices are higher in Middle East tensions and ahead of what could be pivotal talks between Trump and Russian President Vladimir Putin on a ceasefire in Ukraine. Benchmark U.S. crude adding 78 cents to $68.36 a barrel. Brent crude, the international standard, rose 77 cents to $71.84 a barrel.
Amid the uncertainty, gold continues to climb higher. The price for spot market gold is hitting $3,000 an ounce for the first time ever. Considered a safer haven during global economic uncertainty, the precious metal traded around $3,038 early Tuesday.
In Europe at midday, France's CAC 40 rose 0.5%, Germany's DAX added 1.1% and Britain's FTSE 100 rose 0.4%.
In Asia, Japan's benchmark Nikkei 225 gained 1.2% to finish at 37,845.42.
The Bank of Japan was expected to keep its benchmark interest rate unchanged at a monetary policy board meeting due to wrap up Wednesday.
Shares in major Japanese trading companies rose after Warren Buffett’s Berkshire Hathaway reported increases in its ownership of those companies. Itochu Corp. rose 2.5%, Marubeni Corp. added 3.5%, and Mitsubishi Corp. gained 3.6%, while Mitsui & Co. shares were up 3.1%. The investments, although still under 10% in each company, are seen as an expression of confidence in the Japanese economy.
Elsewhere in Asia, Hong Kong’s Hang Seng jumped 2.5% to 24,740.57, led by buying of tech-related stocks. The Shanghai Composite inched up 0.1% to 3,429.76.
Australia's S&P/ASX 200 rose nearly 0.1% to 7,860.40. South Korea's Kospi inched up less than 0.1% to 2,612.34.
Trading on Indonesia stock exchange was suspended temporarily as the benchmark JSX tumbled as much as 6%. But it bounced back a bit, falling 3.8%.
Investors have been selling shares in state-owned banks after the government launched a sovereign wealth fund, called Danantara, that so far has not proven popular. Worries over U.S. President Donald Trumps tariff increases and other risks have also shaken confidence in the economy, said Budi Frensidy, a professor at the University of Indonesia.
AP writer Niniek Karmini in Jakarta contributed to this report.
Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, March 18, 2025. (AP Photo/Ahn Young-joon)
FTSE market information is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
A logo is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
FTSE market information is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
FTSE market information is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
A logo is displayed inside the London Stock Exchange, in the City of London, Monday, March 17, 2025. (AP Photo/Kin Cheung)
Currency traders react near a screen showing the Korea Composite Stock Price Index (KOSPI) and the foreign exchange rate between U.S. dollar and South Korean won, right, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, March 18, 2025. (AP Photo/Ahn Young-joon)
Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, March 18, 2025. (AP Photo/Ahn Young-joon)
DEIR AL-BALAH, Gaza Strip (AP) — Israel launched airstrikes across the Gaza Strip early Tuesday, killing at least 404 Palestinians, including women and children, according to the territory's Health Ministry. The surprise bombardment shattered a ceasefire in place since January and threatened to fully reignite the 17-month-old war.
Prime Minister Benjamin Netanyahu ordered the strikes after Hamas refused Israeli demands to change the ceasefire agreement. Officials said the operation was open-ended and was expected to expand. The White House said it had been consulted and voiced support for Israel's actions.
The Israeli military ordered people to evacuate eastern Gaza, including much of the northern town of Beit Hanoun and other communities further south, and head toward the center of the territory, indicating that Israel could soon launch renewed ground operations.
“Israel will, from now on, act against Hamas with increasing military strength,” Netanyahu’s office said.
The attack during the Muslim holy month of Ramadan could signal the full resumption of a war that has already killed tens of thousands of Palestinians and caused widespread destruction across Gaza. It also raised concerns about the fate of the roughly two dozen Israeli hostages held by Hamas who are believed to still be alive.
A senior Hamas official said Netanyahu’s decision to return to war amounts to a “death sentence” for the remaining hostages. Izzat al-Risheq accused Netanyahu of launching the strikes to try and save his far-right governing coalition and called on mediators to “reveal facts” on who broke the truce. Hamas said at least four senior officials were killed in Tuesday's strikes.
There were no reports of any attacks by Hamas several hours after the bombardment, indicating it still hoped to restore the truce.
The strikes came as Netanyahu comes under mounting domestic pressure, with mass protests planned over his handling of the hostage crisis and his decision to fire the head of Israel's internal security agency. His latest testimony in a long-running corruption trial was canceled after the strikes.
The strikes appeared to give Netanyahu a political boost, with a far-right party that had bolted the government over the ceasefire announcing Tuesday that it was rejoining.
The main group representing families of the captives accused the government of backing out of the ceasefire, saying it “chose to give up on the hostages.”
“We are shocked, angry and terrified by the deliberate dismantling of the process to return our loved ones from the terrible captivity of Hamas,” the Hostages and Missing Families Forum said in a statement.
A strike on a home in the southern city of Rafah killed 17 members of one family, according to the European Hospital, which received the bodies. The dead included five children, their parents, and another father and his three children.
In the southern city of Khan Younis, Associated Press reporters saw explosions and plumes of smoke. Ambulances brought wounded people to Nasser Hospital, where patients lay on the floor, some screaming. A young girl cried as her bloody arm was bandaged.
Many Palestinians said they had expected a return to all-out war when talks over the second phase of the ceasefire did not begin as scheduled in early February. The second phase was broadly outlined in the original agreement, but the details had been expected to be hammered out in those talks.
Israel instead embraced an alternative proposal and cut off all shipments of food, fuel and other aid to the territory's 2 million Palestinians to try to pressure Hamas to accept it.
“Nobody wants to fight,” Palestinian resident Nidal Alzaanin told the AP by phone from Gaza City. "Everyone is still suffering from the previous months,” he said.
Gaza's Health Ministry said at least 404 people were killed in the strikes and more than 560 were wounded after earlier saying that 413 were dead and 660 wounded. Rescuers were still searching the rubble for dead and wounded as the strikes continued.
It was among the deadliest days of the war, which has killed over 48,000 Palestinians, according to local health officials, and displaced an estimated 90% of Gaza’s population. The territory’s Health Ministry doesn’t differentiate between civilians and militants, but says over half of the dead have been women and children.
The war erupted when Hamas-led militants stormed into southern Israel on Oct 7, 2023, killing some 1,200 people, mostly civilians, and taking 251 hostages. Most have been released in ceasefires or other deals, with Israeli forces rescuing only eight and recovering dozens of bodies.
Israel responded with one of the most destructive military offensives in recent memory.
The ceasefire brought some relief to Gaza and allowed hundreds of thousands of displaced Palestinians to return to what remained of their homes.
The White House sought to blame Hamas for the renewed fighting. National Security Council spokesman Brian Hughes said the militant group "could have released hostages to extend the ceasefire but instead chose refusal and war.”
An Israeli official, speaking on condition of anonymity to discuss the unfolding operation, said Israel was striking Hamas' military, leaders and infrastructure and planned to expand the operation beyond air attacks. The official accused Hamas of attempting to rebuild and plan new attacks. Hamas militants and security forces quickly returned to the streets in recent weeks after the ceasefire went into effect.
Netanyahu's office said the Israeli leader held security consultations with senior officials. It did not provide further details.
The strikes came two months after a ceasefire was reached to pause the war. Over six weeks, Hamas released 25 Israeli hostages and the bodies of eight more in exchange for nearly 2,000 Palestinian prisoners as agreed in the first phase.
But since that phase ended two weeks ago, the sides have not been able to agree on a way forward with a second phase that was meant to free the 24 living hostages still in captivity and bring about an end to the war. Israel says Hamas also holds the remains of 35 captives.
The second phase was always going to be difficult to negotiate. Hamas has demanded an end to the war and full withdrawal of Israeli troops in exchange for the release of the remaining hostages. Israel says it will not end the war until it destroys Hamas' governing and military capabilities and frees all hostages — two goals that could be incompatible.
Now Israel has demanded Hamas to release half of the remaining hostages in return for a promise to negotiate a lasting truce. Hamas instead wants to follow the original ceasefire deal reached by the two sides.
Though Israeli forces have killed dozens of Palestinians who the military says approached its troops or entered unauthorized areas since the ceasefire began, the deal has largely held. Egypt, Qatar and the United States have been trying to mediate the next steps.
A full resumption of the war would allow Netanyahu to avoid the tough trade-offs called for in the second phase of the agreement and the thorny question of who would govern Gaza.
It would also shore up his coalition, which depends on far-right lawmakers who want to depopulate Gaza and rebuild Jewish settlements there. That was already in motion with the return of far-right Itamar Ben-Gvir and his party to Netanyahu’s government Tuesday.
The released hostages, some of whom were emaciated, have repeatedly implored the government to press ahead with the ceasefire to return all remaining captives. Tens of thousands of Israelis have taken part in mass protests calling for a ceasefire and return of all hostages.
Mass demonstrations are planned later Tuesday and Wednesday following Netanyahu's announcement this week that he wants to fire the head of Israel's Shin Bet internal security agency. Critics have lambasted the move as an attempt by Netanyahu to divert blame for his government's failures in the Oct. 7 attack and handling of the war.
Federman reported from Jerusalem and Magdy from Cairo. Associated Press reporters Mohammad Jahjouh in Khan Younis, Gaza Strip; Abdel Kareem Hana in Gaza City, Gaza Strip; Fatma Khaled in Cairo; and Tia Goldenberg in Tel Aviv, Israel, contributed.
Follow AP’s war coverage at https://apnews.com/hub/israel-hamas-war
A woman reacts as she stands over the bodies of people killed during overnight Israeli army airstrikes across the Gaza Strip, at the Al-Ahli hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
A woman carries the body of a child to Al-Ahli hospital following overnight Israeli airstrikes across the Gaza Strip, in Gaza City, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
A woman reacts over the body of a person killed during overnight Israeli army airstrikes across the Gaza Strip, at the Al-Ahli hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
A woman reacts next to bodies of Palestinians who were killed in an Israeli army airstrikes are brought to the Al-Ahli Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
Mourners gather around the bodies of Palestinians who were killed in an Israeli army airstrikes as they are brought to Al-Ahli Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
Mourners gather around the bodies of Palestinians who were killed in an Israeli army airstrikes as they are brought to Al-Ahli Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
Palestinians inspect the damage at Al-Tabi'in School in central Gaza Strip following an Israeli airstrike, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
Palestinians inspect the damage at Al-Tabi'in School in central Gaza Strip following an Israeli airstrike, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
A man carries a covered body following overnight Israeli airstrikes across the Gaza Strip, at the Al-Ahli hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
EDS NOTE GRAPHIC CONTENT.- A man carries the body of a child to the Al-Ahli hospital following multiple overnight Israeli airstrikes across the Gaza Strip, in Gaza City, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
Bodies of people killed during overnight Israeli army airstrikes across the Gaza Strip are left in the yard of the the Al-Ahli hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
Palestinians inspect the damage at Al-Tabi'in School in central Gaza Strip following an Israeli airstrike, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
Palestinians inspect the damage at Al-Tabi'in School in central Gaza Strip following an Israeli airstrike, Tuesday, March 18, 2025. (AP Photo/Jehad Alshrafi)
People gather around the bodies of Palestinians who were killed in an Israeli army airstrikes as they are brought to the Al-Ahli Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
A Palestinian man holds the body of his 11 month-old nephew Mohammad Shaban, killed in an Israeli army airstrikes at the Al-Ahli Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
The bodies of Palestinians killed in Israeli army airstrikes are brought to Shifa hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
Injured Palestinians wait for treatment at the hospital following Israeli army airstrikes in Khan Younis, southern Gaza Strip, Tuesday, March 18, 2025. (AP Photo/Mohammad Jahjouh)
The bodies of Palestinians killed in an Israeli army airstrikes are brought to Shifa hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
A body of a Palestinian killed in an Israeli army airstrikes is brought to Shifa Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
The bodies of Palestinians killed in an Israeli army airstrikes are brought to Shifa hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
Palestinians mourn their relative who was killed in an Israeli army airstrikes, at Shifa Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
The bodies of Palestinians killed in an Israeli army airstrikes are brought to Shifa hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
The bodies of Palestinians killed in an Israeli army airstrikes are brought to Shifa hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
The bodies of Palestinians killed in an Israeli army airstrikes are brought to Shifa hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
EDS NOTE: GRAPHIC CONTENT - EDS NOTE GRAPHIC CONTENT.- Palestinians hold the hands of their relative who was killed in an Israeli army airstrike, at Shifa Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Karem Hanna)
A body of a Palestinian killed in an Israeli army airstrikes is brought to Shifa Hospital in Gaza City, Tuesday, March 18, 2025. (AP Photo/Abdel Kareem Hana)
An injured man waits for treatment on the floor of a hospital following Israeli airstrikes in Khan Younis, in the southern Gaza Strip, Tuesday, March 18, 2025. (AP Photo/Mohammad Jahjouh)
Injured Palestinians wait for treatment at the hospital following Israeli army airstrikes in Khan Younis, southern Gaza Strip, Tuesday, March 18, 2025. (AP Photo/Mohammad Jahjouh)
A man mourns over the body of a child, lying among other victims at the hospital morgue, following Israeli airstrikes in Khan Younis, southern Gaza Strip, Tuesday, March 18, 2025. (AP Photo/Mohammad Jahjouh)
A man mourns as he places the body of a child in the hospital morgue following Israeli army airstrikes in Khan Younis, southern Gaza Strip, on Tuesday, March 18, 2025. (AP Photo/Mohammad Jahjouh)
An ambulance carrying victims of an Israeli army strike arrives at the hospital in Khan Younis, southern Gaza Strip, Tuesday March 18, 2025.(AP Photo/ Mohammad Jahjouh)
A dead person killed during an Israeli army strike is taken into the hospital in Khan Younis, southern Gaza Strip, Tuesday March 18, 2025.(AP Photo/ Mohammad Jahjouh)
A dead person killed during an Israeli army strike is taken into the hospital in Khan Younis, southern Gaza Strip, Tuesday March 18, 2025.(AP Photo/ Mohammad Jahjouh)
