U.S. stock indexes traded steadily on Tuesday, consolidating after another session of positive numbers on Wall Street, with attention focused on the Jackson Hole Symposium for further signals.
Wall Street’s benchmark indices were able to close higher on Monday, with the S&P 500 up nearly 1% and the Nasdaq Composite up 1.4%. Both indices posted their eighth straight session in positive territory, the first for the S&P 500 since November 2023, and the longest streak for the Nasdaq since December of last year.
Jackson Hole awaits signals on rate cuts
The Jackson Hole Symposium, a meeting of top central bank leaders and Indian finance ministers later this week, with a speech by Federal Reserve Chairman Jerome Powell on Friday.
Powell’s speech will be closely watched amid growing conviction that the central bank is preparing to cut interest rates by about 25 basis points next month, as recent economic readings pointed to some cooling of inflation.
Powell could signal the possibility of a 50 basis point cut, according to analysts at Evercore, although they do not expect the Fed chairman to speak explicitly on when he plans to start cutting rates.
Any comments regarding a possible recession will also be in focus, particularly if Powell still envisions a soft landing for the U.S. economy.
DNC in the spotlight in the race for Chair 2024
This week, attention will also be focused on the Democratic National Convention, where President Joe Biden will speak on Tuesday.
Vice President Kamala Harris was officially named the Democratic Party’s nominee for president in early August and chose Minnesota Governor Tim Walz as her running mate.
Harris received Biden’s endorsement in July, and recent polls show her closing in fast on Republican frontrunner Donald Trump, indicating a tight race for the presidency in 2024.
Lowe’s Result
Tuesday’s economic data agenda is virtually empty, with investors set to remain focused on the minutes of the Federal Reserve’s latest meeting on Wednesday and Chairman Jerome Powell’s speech in Jackson Hole on Friday.
Home improvement retailer Lowe’s (LOW) will release its results, while shares of cybersecurity company Palo Alto Networks (PANW) rose nearly 2% after reporting positive fiscal fourth-quarter earnings.
The fight to take control of Paramount Global (PARA) has intensified, with media executive Edgar Bronfman Jr. submitting a bid of about $4.3 billion to buy National Amusements, the company that owns a controlling stake in the media giant.
This move puts the planned acquisition by David Ellison, founder and CEO of Skydance Media, in jeopardy.
Crude oil loses ground as geopolitical risks recede
Crude oil prices declined on Tuesday as geopolitical risks eased following progress on a possible Gaza ceasefire deal.
U.S. Secretary of State Antony Blinken said Monday that Israeli Prime Minister Benjamin Netanyahu accepted a “bridging proposal” put forward by Washington to resolve disagreements blocking a Gaza cease-fire deal, and invited Hamas to do the same.
This indicates a greater likelihood of a ceasefire agreement, which would cause market participants to discount the potential dangers of an escalation across the region, something that could affect supply in this oil-rich area.
The decision by the People’s Bank to leave its benchmark interest rate unchanged disappointed some traders, given the weakness of the country’s latest economic data.
In the United States, the American Petroleum Institute will release its estimate of crude oil reserves.
