Stock Futures Fall on Powell’s Hawkish Pivot — and What Else Is Happening in the Stock Market Today

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Stock futures traded modestly lower Wednesday after hawkish comments from Federal Reserve Chairman Jerome Powell, who said the central bank had the “tools and the resolve” to cool inflation.

Contracts linked to the Dow Jones Industrial Average fell 102 points, or 0.3%, to 32,479, S&P 500 futures were down 0.5% and Nasdaq futures decreased 0.7%.

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Stocks finished with strong gains on Tuesday — the Dow gained 1.3%, the S&P 500 rose more than 2% and the Nasdaq jumped 2.8%. Boosting optimization was the fourth straight monthly gain for retail sales in the US during April, and signs that China could be easing Covid lockdowns.

Asian shares closed mixed on Wednesday, with Tokyo’s Nikkei 225 rising 0.9%, and the Shanghai Composite declining 0.3%. European shares traded mostly to the downside early Wednesday.

US stocks initially declined Tuesday after Powell said there “could be some pain involved” in the Fed’s efforts to bring down the highest inflation in the US in 40 years. But they finished sharply higher, led by technology shares.

Powell told a conference hosted by The Wall Street Journal that the Federal Reserve will keep boosting interest rates until it sees inflation “coming down in a convincing way. Until we do, we’ll keep going.”

Jim Reid, an analyst at Deutsche Bank, said that while Powell’s sentiment was not “necessarily new, his explicit comment that neutral rates are ‘not a stopping point’ garnered focus” on Wall Street.

Here are some stocks on the move Wednesday,

Shares of Lowe’s (ticker: LOW) were up slightly in premarket trading ahead of the company’s first-quarter earnings report. Home-improvement rival Home Depot (HD) finished with a gain of 1.7% on Tuesday after earnings topped analysts’ expectations and it raised guidance for 2022.

Target (TGT) gained 0.4% early Wednesday. It reports earnings Wednesday. Shares of the retailer fell 1.4% on Tuesday after Walmart (WMT) missed first-quarter earnings expectations and forecast a decline in full-year per-share earnings.

Write to Joe Woelfel at [email protected]


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