U.S. stocks mostly higher; Powell returns to Capitol Hill
U.S. stocks traded mostly higher Wednesday, as investors gauged a fragile ceasefire between Israel and Iran and assessed commentary from Federal Reserve Chair Jerome Powell, News.az reports citing Investing.
At 09:35 ET (13:35 GMT), the Dow Jones Industrial Average traded 38 points, or 0.1%, lower, while the S&P 500 index gained 9 points, or 0.2%, and the NASDAQ Composite climbed 110 points, or 0.6%.
Ceasefire appears to be holding
The Israel-Iran ceasefire brokered by President Donald Trump appeared to still be in place on Wednesday, a day after the regional rivals said they had ended an air war after 12 days.
Earlier on Tuesday, Trump announced the start of the ceasefire, but lashed out at both Israel and Iran for carrying on with attacks that seemed to have already been planned before the agreement was revealed.
Trump previously came in on the side of Israel, ordering air strikes against Iranian nuclear facilities over the weekend, which Trump declared in a social media post on Tuesday had been "completely destroyed."
U.S. Secretary of State Marco Rubio said earlier Wednesday that Iran is now "much further" away from developing a nuclear weapon following the air strikes, dismissing preliminary reports from U.S. intelligence agencies that suggested that Iran’s enriched uranium stocks were not eradicated by the strikes and the nation’s mostly-underground nuclear program may have only been set back by a couple of months.
Elsewhere, NATO leaders have agreed to a higher defense spending target -- 5% of gross domestic product by 2035 -- marking a potential foreign-policy victory for Trump after his recent demands that the alliance’s partners more than double their expenditure commitments.
Powell returns to Capitol Hill
Fed Chair Powell returns to Capitol Hill later Wednesday as part of his two-day Semiannual Monetary Policy Report to Congress, addressing the Senate later Wednesday after speaking to the House the prior day.
Powell was subjected to a grilling from House lawmakers over why the Fed is not moving quickly to slash rates, an often-repeated demand from Trump, but the Fed chairman said officials are wary that price gains could accelerate again soon due to the implementation of elevated U.S. tariffs.
He is also expected to reiterate later Wednesday that the Fed won’t be comfortable cutting interest rates until it sees if prices do begin to rise and whether that process shows signs of becoming more persistent.
Investors will watch Wednesday for data on new home sales, after U.S. consumer confidence dropped more than expected in June, as Americans were becoming more worried about the economy, despite strong job numbers and low unemployment.
One of the biggest reasons for the decline appeared to be rising concerns about inflation and tariffs.
General Mills warns about sales growth
The earnings slate Wednesday, General Mills (NYSE:GIS) stock fell after the food processing giant warned of weak sales growth and slipping income in its current fiscal year, as it grapples with a tariff-driven operating headwinds.
FedEx (NYSE:FDX) stock slumped after the delivery giant and economic bellwether unveiled a current-quarter profit forecast that missed analysts’ expectations, while human resources company Paychex (NASDAQ:PAYX) stock fell after the HR management firm reported fourth-quarter top and bottom line that failed to impress.
BlackBerry (NYSE:BB) stock surged higher after the cybersecurity firm raised its annual revenue forecast citing steady demand amid growing online crimes.
Crude rebounds
Crude prices edged higher Wednesday after falling sharply in the last two sessions as a ceasefire between Iran and Israel diluted the chances of oil flows being disrupted.
At 09:35 ET, Brent futures climbed 0.5% to $66.51 a barrel and U.S. West Texas Intermediate crude futures rose 0.8% to $64.86 a barrel.
Prices had plummeted to a near three-week low on Tuesday after President Trump announced a ceasefire between Israel and Iran, helping quell some concerns over supply disruptions stemming from their conflict.
Data from the American Petroleum Institute, released on Tuesday, showed that U.S. inventories shrank nearly 4.3 million barrels in the past week, following on from a bumper 10.1 mb draw from the week before.
Official inventory data from the Energy Information Administration are due later on Wednesday.
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