Wall Street’s main indexes slipped on Tuesday as investors awaited comments from Federal Reserve Chairman Jerome Powell, which will scrutinize how long the central bank will keep interest rates high.
Powell’s comments, due before the Economic Club of Washington at 12:40 p.m. EST (1740 GMT), will be closely watched on rising expectations of less aggressive monetary policy following a strong jobs report last week.
“Markets are still trying to figure out last Friday’s jobs data on the future direction of the Fed,” said Sam Stovall, chief investment strategist at CFRA Research.
“He (Powell) expecting too much to say what he did, that what the Fed is going to do, may have underestimated the market, even though he said they might raise rates a couple of times.”
Traders are speculating that the central bank will raise the benchmark rate to 5.1% in June, which has been vocally supported by policymakers.
Capping declines on the tech-heavy Nasdaq was megacap Microsoft Corp. Shares of the company added 1.9% ahead of an event later in the day where it is widely expected to unveil the potential integration of ChatGPT, a chatbot from OpenAI, into its products.
US-listed shares of Baidu Inc rose 8.9% as the Chinese search engine said it would conclude testing of its ChatGPT-style project ‘Ernie Bot’ in March.
Seven of the top 11 sectors on the S&P 500 were in decline, but technology, backed by Microsoft, was one of the top gainers.
Among top gainers on the Dow Jones Industrial Average, Boeing Inc climbed 0.8% after the US planmaker confirmed on Monday it expected to cut about 2,000 white-collar jobs through layoffs and layoffs.
Expectations of higher rates for a longer period dragged Wall Street’s main indices down on Monday. But, with all three major averages in the black for 2023, the Nasdaq is up more than 13%, led by a revival in battered mega-cap growth stocks.
So far, more than half of the companies on the S&P 500 have reported quarterly earnings, with 69.1% of them beating expectations, according to Refinitiv. Still, analysts expect fourth-quarter earnings to decline by 3.1%.
At 10:18 a.m., the Dow was down 121.48 points, or 0.36%, at 33,769.54, the S&P 500 was down 10.83 points, or 0.26%, at 4,100.25 and the Nasdaq Composite was down 13.31 points, or 0.11%. 11,874.14.
DuPont De Nemours Inc jumped 6.2% on better-than-expected quarterly profit supported by higher pricing for its products.
Bed Bath & Beyond plunged 40.3% as the beleaguered home-goods retailer seeks a $1 billion raise in a last-ditch effort to avoid bankruptcy.
Later in the day, US President Joe Biden will deliver the annual State of the Union address to a joint session of Congress.
The number of advances continues to decline to a 2.31-to-1 ratio on the NYSE and to a 1.97-to-1 ratio on the Nasdaq.
The S&P Indices recorded two new 52-week highs and two new lows, while the Nasdaq recorded 35 new highs and 15 new lows.
The text of this story is published from a wire agency feed without any modification. Only the headline has been changed.
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