Dow Set to Open Flat Ahead of Powell's Fed Speech
Stocks looked set to edge higher on Tuesday, with Wall Street reluctant to make any big moves ahead of a speech from Federal Reserve Chair Jerome Powell that could give a better sense of where interest rates are headed.
Futures tracking the Dow Jones Industrial Average climbed 23 points, or 0.1%. Contracts tied to the S&P 500 and Nasdaq 100 were trading flat.
The yield on the benchmark 10-year U.S. Treasury note slipped 2 basis points to 4.13% in early trading. Gold climbed 0.4%, putting the precious metal on the brink of topping $3,800 an ounce for the first time ever. The U.S. dollar ticked up 0.1% against a weighted basket of its peers.
Still, the rally since April remains narrow, with most of the market’s gains being driven by Big Tech. Concerns remain about the overall health of the U.S. economy, with unemployment creeping up and inflation running nearly a full percentage point above the Fed’s 2% target.
“Equity indices are soaring even as the real economy shows signs of strain, with sticky inflation, a cooling labour market, and uncertainty over the timing of rate cuts,” Hargreaves Lansdown analyst Matt Britzman said. “For now, optimism around AI-driven growth and record levels of investment is keeping momentum alive, but the balancing act is precarious.”
Powell is set to speak at the Greater Providence Chamber of Commerce, where he’ll share his economic outlook. The Fed lowered interest rates last week, but Powell described the move as a “rate-management cut,” signaling that the central bank will only carry on slashing borrowing costs if jobs numbers worsen.
Flash U.S. purchasing managers’ index data due out on Tuesday will also give investors a better sense of how the economy is holding up amid the Trump administration’s sweeping tariffs, stubborn inflation, and a faltering job market.