Wall Street: A small increase before Powell’s hearing

(CercleFinance.com) – Wall Street is heading for a slight increase on Tuesday morning, with investors limiting their activity in view of the intervention of Jerome Powell, the chairman of the Fed, before American parliamentarians.

Half an hour before the opening, futures contracts on the major New York indices were up 0.1% to 0.3%, announcing a modest increase to start the session.

With no major indicators in sight, investors will focus all their attention on Powell’s testimony before the Senate Banking Committee, which begins at 10:00 a.m. ET.

Given the recent slowdown in inflation, operators will be on the lookout in his statements for the slightest indication that could allow them to confirm the scenario of a rate cut in September.

“It will be interesting to hear what he has to say about the weaker-than-expected economic indicators recently published, and in particular the announcement of an unemployment rate (4.1%) now at its highest since November 2021,” Deutsche Bank analysts point out.

According to the Fedwatch barometer, traders are currently expecting a rate cut in September with a probability of almost 72%.

Hopes for more accommodative Fed policy are among the main drivers of the ongoing rally, which again lifted the S&P 500 and Nasdaq indices to new all-time highs last night.

Aside from Powell’s hearing, investors will have plenty to keep their attention on before the end of the week, including the latest inflation figures due out on Thursday.

The season will also kick off this Friday, with the accounts of the major American banks JP Morgan, Citi and Wells Fargo, while awaiting the crucial publications of the ‘Magnificent Seven’.

“Investors have high expectations for the earnings and forecasts that the few tech giants that continue to dominate market gains will release,” said Cesar Perez Ruiz, chief investment officer at Pictet Wealth Management.

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