Stock market today: Wall Street is higher ahead of speech by Fed’s Powell
By Yuri Kageyama And Matt Ott, The Associated Press on August 25, 2023.
NEW YORK (AP) – Stocks are rising in early trading, but investors will be closely watching a speech by the Federal Reserve Friday morning. The S&P 500 was 0.4% in the early going, coming off its worst loss in three weeks. The Dow was up 180 points and the Nasdaq composite was up 0.5%. The day’s headliner is Fed Chair Jerome Powell, who is giving a speech at an annual event that’s been the site of big policy announcements. The hope is that he’ll say the fall in inflation over the last year is encouraging and that the Fed may be done hiking interest rates. THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below. Wall Street pointed higher as markets wait to hear what Federal Reserve Chair Jerome Powell has to say in his speech later Friday at a conference of central bankers. Futures for the Dow Jones industrials and S&P 500 each rose about 0.4% before the bell. With no major economic news and few earnings reports to review Friday, all eyes will be on Powell, who will be speaking at an event in Jackson Hole, Wyoming that in the past has been the site of major policy announcements by the Fed. The speech is scheduled to begin right after 10 a.m. ET. Reports on the U.S. economy were mixed Thursday, with one showing fewer U.S. workers applied for unemployment benefits last week, pointing to a still healthy job market. Another said orders for long-lasting manufactured goods slumped by more last month than economists expected. For now, weaker-than-expected reports on the economy may be more welcome in financial markets. The economy has managed to avoid a long-predicted recession, but the fear is that it’s so solid that it will keep upward pressure on inflation. The Federal Reserve has already raised its main interest rate to the highest level since 2001 in hopes of grinding down high inflation. High rates work to do that by slowing the entire economy and hurting prices for investments. Hope had built that the Fed’s latest rate hike in July would prove to be the last of this cycle, after inflation cooled considerably since peaking above 9% last summer. Traders also have made bets for the Fed to begin cutting rates in early 2024. But a series of stronger-than-expected reports on the economy has diminished those hopes. In Europe at midday, France’s CAC 40 rose 0.7%, Germany’s DAX added 0.5% and Britain’s FTSE 100 gained 0.2%. But in Asia, benchmarks sank, while oil prices rose. Japan’s benchmark Nikkei 225 dropped 2.1% to finish at 31,624.28. Australia’s S&P/ASX 200 dipped 0.9% to 7,115.20. South Korea’s Kospi lost 0.7% to 2,519.14. Hong Kong’s Hang Seng slipped 1.4% to 17,956.38, while the Shanghai Composite shed 0.6% to 3,064.07. Japanese inflation eased to 2.9% in August from the previous year, largely because of lower energy prices, according to government data. The consumer price index, excluding fresh food prices, rose 2.8% from the previous year, the gains easing for the first time in two months. Although inflationary pressures appear to be gradually fading in Japan amid stabilizing energy prices, the indicator for prices is still above the Bank of Japan’s target of 2%. In energy trading, benchmark U.S. crude jumped $1.07 to $80.12 a barrel. Brent crude, the international standard, added $1.04 to $83.96 a barrel. In currencies, the U.S. dollar edged up to 145.95 Japanese yen from 145.81 yen. The euro cost $1.0810, down from $1.0819. Wall Street closed lower Thursday despite a blowout profit report from chipmaker Nvidia, which has boosted optimism in the tech sector recently around the seemingly endless possibilities for artificial intelligence technology. The S&P 500 fell 1.3%, the Dow finished 1.1% lower and the Nasdaq composite slid 1.9%. ___ Kageyama reported from Tokyo; Ott reported from Silver Spring, Maryland. 20-19
