Stocks Open Lower, Awaiting Fed Chair Powell’s Speech
U.S. stocks opened lower on Tuesday morning, with the Dow Jones Industrial Average dropping 0.1%, the Nasdaq Composite falling 1%, and the S&P 500 declining 0.6%. The Dow Jones Industrial Average fell 35 points, the Nasdaq was down 119.5 points, and the S&P 500 lost 25.4 points. Treasury yields rose, with the 10-year yield climbing 10 basis points to 3.64%, while the 2-year yield was flat at 4.46%.
Investors awaited comments from Federal Reserve Chairman Jerome Powell due to speak at the Economic Club of Washington, D.C., with traders looking for any indications of the future interest rate trajectory after last Friday’s jobs report came in significantly better than anticipated. The U.S. economy added 517,000 jobs in January, the Labor Department said Friday, easily topping a Dow Jones consensus forecast of 187,000. The unemployment rate declined to 3.4% from 3.5% in December – its lowest level since 1969.
Other major companies reporting this week include Chipotle Mexican Grill (CMG), Royal Caribbean (RCL), The Walt Disney Co. (DIS), PepsiCo (PEP), Uber (UBER), and AbbVie (ABBV).
Pre-market movers included Tyson Foods (TSN) tumbling more than -5% after reporting Q1 sales of $13.26 billion, below the consensus of $13.52 billion. Meanwhile, Catalent (CTLT) surged more than +25% after a Bloomberg report said that Danaher is said to be interested in acquiring the company.
Oil prices rose, with West Texas Intermediate (WTI) crude up 0.7% to $73.93 per barrel, and Brent crude, the international benchmark, tacking on 1.63% to hit $81.24. Dell Technologies (DELL) also announced it would be cutting about 6,650 jobs, or roughly 5% of its global workforce.
Overall, investors will remain focused on the Fed and Powell’s comments as they try to gauge the central bank’s next steps and the direction of the U.S. interest rate.
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