US equity markets experienced a downturn on Tuesday, closing with losses across major indices. The Dow Jones Industrial Average finished at 46,293 points, representing a 0.2% decrease from the previous day’s close.
Earlier in the session, the broader S&P 500 index registered around 6,657 points, down 0.6%, while the technology-focused Nasdaq 100 stood at approximately 24,573 points, showing a 1.0% decline.
Market participants were keenly awaiting a speech by Federal Reserve Chair Jerome Powell, anticipating his perspective on the economic outlook. However, Powell’s remarks refrained from outlining a path towards interest rate cuts, instead emphasizing the complexities facing the Federal Reserve. He stated that “short-term risks to inflation are tilted to the upside, risks to employment are tilted to the downside”. He further explained that these opposing risks eliminate a ‘risk-free’ course of action.
Powell cautioned that prematurely easing monetary policy could jeopardize the fight against inflation, potentially requiring a subsequent policy reversal. Conversely, maintaining restrictive policies for too long could unnecessarily weaken the labor market. “When our goals are in such tension, we must balance both sides of our dual mandate” he explained.
The Euro strengthened against the US dollar, trading at $1.1816, with the dollar fetching €0.8463.
Gold prices saw an increase, reaching $3,764 per fine ounce (+0.4%), equivalent to €102.43 per gram.
Crude oil prices also rose significantly, with a barrel of Brent crude trading at $67.95, a 2.1% increase compared to the previous day’s closing price.
