Last Updated: 4:05 PM EST
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Stock indices ended little changed in today’s trading after Federal Reserve Chair Jerome Powell talked about the cooling job market and the central bank’s fight against inflation in his testimony to the Senate Banking Committee. Although inflation is still above the Fed’s 2% goal, he mentioned that significant progress has been made against it. Powell also warned that cutting rates too late or too little could hurt economic activity and jobs. As a result, he could be hinting that rate cuts might be coming soon.
However, it’s worth noting that Powell didn’t specify when the Fed might cut rates. Still, that hasn’t stopped investors from speculating when it might happen. In fact, signs of cooling inflation and a slowing economy have led investors to expect a possible rate cut as soon as the Fed’s September meeting, with the chances now around 72%, according to CME FedWatch.
First Published: 4:27 AM EST
The U.S. futures edged higher on Tuesday as momentum in broader indices sustained after the S&P 500 and Nasdaq Composite closed at new record highs. Investors are more hopeful that the Federal Reserve will soon cut interest rates as inflation eases. The futures on the Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were up by about 0.28%, 0.16%, and 0.04%, respectively, at 3:28 a.m. EST, July 9.
On Monday, the Nasdaq 100 and S&P 500 hit new highs thanks to excitement over artificial intelligence (AI) and hopes for future rate cuts. The Nasdaq 100 and S&P 500 have increased by about 21.5% and 17%, respectively, year-to-date. However, the upcoming economic data and corporate earnings reports might affect the market’s trend.
In after-hours trading, Zapp Electric Vehicles (ZAPP) stock jumped more than 24% after a significant rise of 127% on Monday. This reflects a higher adoption of EVs. Intel (INTC) stock also continued to rise, as Melius Research predicts growth for the company in the latter half of 2024. Conversely, Helios Technologies’ (HLIO) shares dropped 8.33% after its CEO was placed on leave for a possible violation of the company’s business and ethics code.
Turning to this week’s economic reports, June’s CPI report, which measures inflation and influences the Fed’s policy, is due on Thursday, July 11. June’s Producer Price Index (PPI), a key inflation indicator, will be released on Friday, July 12. The Michigan Consumer Sentiment Index and the University of Michigan’s 5-year inflation report will also be available on Friday.
On the earnings front, SMART Global Holdings (SGH) will release its Q3 financials after the market closes today. Analysts expect SMART Global Holdings to post earnings of $0.30 per share, down from $0.66 in the prior-year quarter.
Meanwhile, the U.S. 10-year treasury yield was up at writing, floating near 4.29%. At the same time, WTI crude oil futures trended lower, hovering near $85.69 per barrel as of the last check.
Elsewhere, European indices opened lower as the French election result added uncertainty to the market.
Asia-Pacific Markets Were Higher Today
Asia-Pacific indices were lower on Tuesday following gains on Wall Street. Japan’s Nikkei and Topix indices increased 1.96% and 0.97%, respectively.
Elsewhere, China’s Shanghai Composite and Shenzhen Component indices gained by 1.26% and 1.68%, respectively. At the same time, Hong Kong’s Hang Seng index was up 0.09%.
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