Stock market festivity unfolds on Wall Street
After eight straight days of increases, Wall Street takes a rest: US stock markets conclude with minor losses. The market is anticipating clear indicators for a September interest rate reduction, which may emerge within a few days from the Fed conference.
The Wall Street failed to maintain its upward trend on Tuesday. The Dow Jones Industrial Average of elite stocks closed slightly lower at 40,835 points. The broader-based S&P 500 also decreased slightly to 5,597 points. The Nasdaq tech index lost 0.3 percent to 17,817 points. On Monday, the stock market indicators had showcased an eight-day winning streak. Robust economic data, primarily, had been fortifying investor confidence, lessening concerns about an economic depression.
However, apprehension is increasing prior to significant events later in the week. The international central bank conference in Jackson Hole, Wyoming, commencing Thursday, is the center of attention. Investors are particularly excited about a speech by Fed Chair Jerome Powell on Friday. "We assume Powell will set the stage for a rate cut next month," said Win Thin, chief strategist at New York private bank Brown Brothers Harriman. "However, he will stress that the Fed's subsequent moves hinge on economic data and will resist any suggestion of pre-commitment to a forceful easing trajectory."
Although recent robust US economic data suggests that only a small number of market participants now anticipate the US central bank to reduce rates by half a percentage point, it remains uncertain what follows the generally predicted loosening of monetary policy in September. Investors also hope to gather further insights from the minutes of the latest Fed meeting, to be published on Wednesday.
Experts anticipate gold price to escalate further
Briefly, hopes of lower US interest rates propelled gold to a new peak record. The precious metal surged by approximately 1.1 percent to $2,531.60 per ounce, hitting an all-time high. Subsequently, it stabilized with a small gain of around $2,516. Experts believe the rally will persist in the long term. Elements driving this include the prospect of lower US interest rates and geopolitical uncertainties caused by tensions in the Middle East. The US dollar, which was near its seven-month low ahead of the central bank conference, also boosted the dollar-denominated precious metal.
Conversely, oil prices declined again. North Sea Brent crude and US WTI light crude each fell by about 0.4 percent to $77.23 and $74.04 per barrel (159 liters). The expectation of a ceasefire in the Gaza Strip alleviated investors' concerns about a supply shortage.
Palo Alto was in demand among individual stocks on Tuesday. The shares of the US cybersecurity specialist ascended by 7.2 percent. The company forecasts full-year revenue between $9.10 and $9.15 billion, with analysts anticipating $9.11 billion on average. The earnings outlook also surpassed market expectations. Specialists attribute the current surge in cybercrime to the heightened demand for IT security.
Investors also purchased Eli Lilly shares, which increased by three percent. Its weight loss drug Mounjaro has significantly diminished the risk of diabetes in a long-term study.
Boeing encountered pressure with a 4.1% decrease. The embattled aircraft manufacturer is once again facing safety concerns: On Monday, the U.S. Federal Aviation Administration (FAA) ordered inspections of hundreds of 787 Dreamliner aircraft.
Explore other stock market developments for today here.
The minor losses in US stock markets on Tuesday affected the share prices of major indices, with the Dow Jones Industrial Average closing slightly lower at 40,835 points. Investors are closely watching the speech by Fed Chair Jerome Powell at the international central bank conference in Jackson Hole, Wyoming, as it could influence the anticipated September interest rate reduction.
Despite the recent surge, the future trajectory of gold prices remains uncertain, as investors await further insights from the minutes of the latest Fed meeting, scheduled for publication on Wednesday.
