Tuesday’s trading session unfolded relatively quietly, with major U.S. indices hovering around the flatline during midday trading in New York. Investor activity remained subdued as traders awaited key events, including the release of minutes from Wednesday’s Federal Open Market Committee (FOMC) meeting and Nvidia Corp.’s earnings report.
Federal Reserve Commentary:
Federal Reserve officials delivered mixed messages, contributing to the cautious sentiment. Atlanta Fed President Raphael Bostic expressed expectations for a gradual decline in inflation but ruled out a rate cut before the fourth quarter. Conversely, board member Christopher J. Waller adopted a more dovish stance, asserting that the risk of inflation accelerating further has diminished and expressing skepticism about an imminent rate hike.
Market Movement:
Market sectors and industries exhibited minimal movement, with financials and solar stocks demonstrating slight outperformance. However, small caps softened, with the iShares Russell 2000 ETF (NYSE:IWM) declining by 0.3%. Treasury yields edged lower, with the benchmark 10-year yield decreasing by 4 basis points to 4.41%, potentially ending a three-session streak of yield gains.
Commodities and Cryptocurrency:
In commodities trading, metal prices paused after reaching record highs on Monday, with both gold and copper taking a breather. Crude oil prices experienced a 1.6% decline. In the cryptocurrency market, Bitcoin (CRYPTO: BTC) retreated by 2.2% to $69,900, reflecting a shift in investor sentiment away from riskier assets.
Major U.S. Indices:
Major U.S. indices displayed marginal movements, with the Nasdaq 100, S&P 500, and Dow Jones trading near the flatline, while the Russell 2000 dipped by 0.2%. The SPDR S&P 500 ETF Trust (NYSE:SPY), SPDR Dow Jones Industrial Average (NYSE:DIA), and Invesco QQQ Trust (NASDAQ:QQQ) remained relatively unchanged.
Sector Focus:
Among sector-focused ETFs, the Financial Select Sector SPDR Fund (NYSE:XLF) outperformed with a 0.3% increase, while the Industrial Select Sector SPDR Fund (NYSE:XLI) lagged behind, declining by 0.5%.
Individual Stock Movements:
Several individual stocks experienced notable movements in response to earnings reports. Palo Alto Networks Inc. (NASDAQ:PANW) initially dropped by 6% following weaker-than-expected guidance but later recovered some losses. Lowes Companies Inc. (NYSE:LOW) fell by 3% after highlighting emerging margin pressures in Q2. First Solar Inc. (NASDAQ:FSLR) surged by nearly 6%, leading the S&P 500 stocks, after UBS raised its price target.
Upcoming Earnings Reports:
Upcoming earnings reports after the market close include companies such as Toll Brothers Inc. (NYSE:TOL), XP Inc. (NASDAQ:XP), Modine Manufacturing Company (NYSE:MOD), Skyline Champion Corp. (NYSE:SKY), and Alvotech (NASDAQ:ALVO).