Stocks fluctuate as investors await Fed rate clarity

Stocks fluctuate as investors await Fed rate clarity

US stocks struggled for direction in Wednesday’s open as investors awaited clarity from Federal Reserve policymakers on their monetary tightening plans against a backdrop of pessimistic economic data.

The S&P 500 was just below breakeven in early trading after the benchmark index dropped for three consecutive sessions. The Dow Jones Industrial Average was down 50 points, or about 0.2%, while the Nasdaq Composite was flat.

Peloton (PTON) shares rose 13% after the company said it struck a deal to sell its fitness equipment and apparel on Amazon in an effort to turn around its business and regain investor confidence.

Investors are worried about the central bank’s annual symposium in Jackson Hole, Wyoming, later this week, where policymakers are expected to reiterate the Fed’s commitment to fighting inflation and dampening hopes of rate cuts next year.

Despite messages from Federal Reserve speakers in recent weeks stating that rate hikes will continue through the end of the year, the market is still pricing in a dovish pivot, Baird investment strategy analyst Ross Mayfield told Yahoo Finance Live.

“I think all his jaw and hawkishness over the last few weeks is starting to show,” Mayfield added. “But you still have a market that I’m not sure I believe they’re going to stick with as the economy slows next year.”

At the end of the Fed meeting in Wyoming, traders will tune in to Chairman Jerome Powell’s remarks for clues as to whether the next monetary policy announcement on Sept. %.

US Fed Chairman Jerome Powell and Bank of England Governor Mark Carney speak over the three days

US Fed Chair Jerome Powell and Bank of England Governor Mark Carney speak during the three-day “Challenges for Monetary Policy” conference in Jackson Hole, Wyoming, US, Aug. 23, 2019. REUTERS/ Jonathan Crosby TPX IMAGES OF THE DAY

Meanwhile, Nordstrom (JWN) shares are down nearly 15% after the department store giant lowered its guidance for full-year sales to a range of 5% to 7% Tuesday afternoon due to demand. slower speed and stockpiling. The move comes just three months after the company raised its prospects.

“Low-income customer segments saw significantly more downturn versus high-income segments,” CEO Erik Nordstrom during Tuesday’s earnings call, pointing to a specific slowdown in the Store’s Discount Racks business.

Earnings season is over, but more profits are in store for traders, with reports from Nvidia (NVDA) and salesforce.com (CRM) coming out Wednesday.

In commodity markets, oil futures continued to gain after Saudi Arabia suggested on Tuesday that the OPEC+ alliance could make production cuts possible. WTI crude futures rose about 1.2% to remain above $94 a barrel, while Brent crude futures rose by the same margin to $101 a barrel.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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