U.S. stocks pull back; Powell to address the Fed


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U.S. stocks declined on Tuesday, losing ground from record levels ahead of a speech by Federal Reserve Chairman Jerome Powell.

Wall Street’s major indices closed Monday’s trading day higher, with the S&P 500 gaining 0.3% and the Dow Jones Industrial Average rising 0.1%, while the NASDAQ Composite rose 0.8% to close at record levels, supported mainly by gains in technology stocks.

Powell, payrolls and Fed minutes in the spotlight

Investors appear to be taking a breather ahead of Jerome Powell’s speech at the European Central Bank conference this Tuesday, where the Fed chairman could address the latest data showing a slight cooling of both the economy and inflation.

The minutes of the Fed meeting will be released Wednesday, following the central bank’s projection that it will only cut rates once this year. Several Fed officials have signaled that persistent inflation will delay any plans to ease monetary policy.

May job openings and labor turnover will also be released on Tuesday, although the focus will be on nonfarm payrolls due on Friday.

The labor sector has remained very active despite inflation and high interest rates, and is a key factor for the Fed when considering interest rate reductions.

Despite the Fed’s bullish signals, traders have increased their bets that the central bank will cut rates by 25 basis points in September.

Paramount Global in play?

In corporate industrials, Paramount Global (PARAA) was up 4% before the market opened following The New York Times’ report that billionaire Barry Diller was mulling a bid for the company.

Boeing (BA) shares lost about 0.4% after the Associated Press reported that the U.S. Justice Department is on the lookout for the plane maker to agree to a settlement of fraud charges linked to two fatal crashes of its 737 Max planes.

Tesla (TSLA) shares lost about 1.3% before the market opened after sales of electric cars made in China fell about 24.2% in June to 71,007, according to the China Passenger Car Association.

Crude oil near two-month highs

Crude oil prices rose on Tuesday, continuing to hover near two-month highs ahead of expectations of an increase in U.S. summer fuel demand.

Gasoline demand in the United States, the world’s largest oil consumer, is expected to increase as the summer travel season picks up steam due to the Independence Day holiday.

Traders will also be focused on the latest data on U.S. crude stockpiles, to be released later today by the American Petroleum Institute, as well as possible disruptions from Hurricane Beryl to U.S. oil refining and offshore Gulf of Mexico production.

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