US Stocks: S&P 500 ends nearly flat, gives back gains; Fed's Powell says inflation to rise
NEW YORK: The S&P 500 ended nearly flat on Wednesday, giving back earlier gains after Federal Reserve Chair Jerome Powell said inflation in goods prices is expected to go up over the summer as President Donald Trump's tariffs work their way to consumers.
The U.S. central bank left interest rates unchanged, as expected. In the statement, policymakers maintained expectations for two cuts this year, but a rising minority expected no rate cuts at all. Also, they slightly slowed the expected pace to a single quarter-percentage-point cut in each of 2026 and 2027.
Stocks were moderately higher before Powell's comments. As he spoke, U.S. Treasury yields also pared most of their earlier drop.
"He made it quite clear he's not going to change monetary policy until they are sure of the tariffs' effect on inflation," said Peter Cardillo, chief market economist at Spartan Capital Securities.
So, "you have the combination of yields going up, and the fact that it's going to take time to see the effects" of the tariffs, he said.
Investors also have been closely watching developments in the Middle East. Some worry about the possibility of a more direct U.S. military involvement in the Israel-Iran aerial war.
Iranian Supreme Leader Ayatollah Ali Khamenei rejected Trump's demand for unconditional surrender. Trump said his patience had run out, though he did not indicate what his next step would be.
Energy led declines among S&P 500 sectors, while information technology was up the most.
The Dow Jones Industrial Average fell 44.14 points, or 0.10%, to 42,171.66, the S&P 500 lost 1.85 points, or 0.03%, to 5,980.87 and the Nasdaq Composite gained 25.18 points, or 0.13%, to 19,546.27.
Early in the day, initial jobless claims data showed the number of Americans filing new applications for unemployment benefits fell last week, but stayed at levels consistent with a further loss of labor market momentum in June.
Powell's "message was consistent with what has been telegraphed. Inflation is still elevated, but tariffs in the coming months will be a wild card. Powell said if not for tariffs he would be cutting rates now," said Sahak Manuelian, managing director of global equity trading at Wedbush Securities in Los Angeles.
Shares of stablecoin issuer Circle Internet rose 33.8% after the U.S. Senate passed a bill to create a regulatory framework for dollar-pegged cryptocurrency tokens known as stablecoins.
Steelmaker Nucor rose 3.3% following a second-quarter profit forecast that came above analysts' estimates.
Advancing issues outnumbered decliners by a 1.28-to-1 ratio on the NYSE. There were 102 new highs and 55 new lows on the NYSE.
On the Nasdaq, 2,613 stocks rose and 1,882 fell as advancing issues outnumbered decliners by a 1.39-to-1 ratio.
Volume on U.S. exchanges was 16.48 billion shares, compared with the 17.99 billion average for the full session over the last 20 trading days.
(Reporting by Caroline Valetkevitch; additional reporting by Kanchana Chakravarty and Sukriti Gupta in Bengaluru and Sinead Carew and Stephen Culp in New York; Editing by Shinjini Ganguli and David Gregorio)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Al Etihad
19 minutes ago
- Al Etihad
Sterling slips ahead of Bank of England decision; Middle East in focus
19 June 2025 11:02 LONDON (Reuters) Sterling slipped versus a stronger dollar on Thursday ahead of the Bank of England's policy decision, with no change to rates the widely expected outcome, while investor sentiment remained fragile given the conflict in the Middle 0618 GMT the pound was 0.24% lower at $1.339 and unchanged against the euro, which held at 85.515 dollar strengthened after the Federal Reserve held rates steady as expected on Wednesday, and amid a surge in safe haven demand as a conflict in the Middle East continues and President Donald Trump weighs US are betting the BoE will follow suit in keeping rates steady on Thursday, even as the UK's economic growth is faltering and inflation cooled slightly in chance of no change stands at 96%, with a tiny chance of a 25 basis point rate cut. Attention will be on the voting, after last month's surprise three-way split among policymakers.A Reuters poll last week of 60 economists found that all of them expect the BoE to keep rates at 4.25% in June and almost all forecast a quarter-point rate cut in August.A jump in the price of oil during the ongoing Israel-Iran conflict presents another problem for the central bank to grapple with, as it could keep inflation pound has slipped more than 1% since last Thursday, but it remains 7% higher against the greenback in 2025, helped by a rush away from US assets spurred by heightened trade uncertainty in light of Trump's helping out is the fact that the UK is the only country to have struck a trade deal with the United States. Trump and British Prime Minister Keir Starmer finalised the deal at the G7 summit this week.
Khaleej Times
32 minutes ago
- Khaleej Times
Dubai: Gold prices drop further, losing nearly Dh7 per gram this week
Gold prices dropped Dh2 per gram further at the opening of the markets in Dubai on Thursday. At 9am UAE time on Thursday, 24K was trading at Dh406.75 per gram, down from Dh408.75 per gram at the close of the markets on Wednesday. It has lost nearly Dh7 per gram this week. Recommended For You Among the other variants, 22K, 21K and 18K slipped to Dh376.5, Dh361 and Dh309.5 per gram, respectively. Spot gold was trading at $3,356.96 per ounce, down nearly one per cent after the US Federal Reserve expected a slower pace of future interest rate cuts. 'The dot plot still shows two rate cuts this year — but that median projection doesn't tell the full story. There's now a growing divide within the Fed: while eight members expect rates to fall by 50bp (matching two cuts), seven see no change — up from just four at the previous meeting. Two members anticipate one cut. That's now almost a 50-50 split between no cuts and a 50bp reduction,' said Ipek Ozkardeskaya, senior analyst at Swissquote Bank. 'The market reaction to the Fed decision wasn't exactly cheery. The S&P 500 fell after the decision, though the US two-year yield eased. Meanwhile, Fed funds futures show a slightly higher probability of a September cut than before the meeting. Investors seem inclined to see the glass half full — hoping for two cuts — rather than half empty, with none,' he said. The US dollar was in doji mode yesterday but is stronger this morning, perhaps supported by a relatively cautious Fed tone and some flight to safety. 'There are rumours the US could become directly involved in Middle East tensions as soon as this weekend. That alone could attract defensive flows into the dollar ahead of a potentially critical weekend – regardless of Fed policy,' added Swissquote Bank's senior analyst.
Gulf Business
an hour ago
- Gulf Business
Iran-Israel tensions: Gold surges, Platinum hits 10-year high
Image credit: Getty Images Gold prices gained on Thursday, June 19, as the Iran-Israel tension entered its seventh day, while platinum rose to a more than 10-year high on expectations of a supply shortfall. Spot gold was up 0.1 per cent at $3,371.15 an ounce, as of 0526 GMT. US gold futures fell 0.6 per cent to $3,388.60. Read- 'Gold has made a modest bounce as we await the next steps in the Israel-Iran conflict. If the US does decide to get directly involved, this could raise the geopolitical stakes,' KCM Trade Chief Market Analyst Tim Waterer said. Gold edges up amid heightened geopolitical tensions Gold is often used as a safe store of value during times of geopolitical and financial uncertainty. Meanwhile, the US Federal Reserve held interest rates steady on Wednesday. Fed policymakers still forecast slashing rates by half-a-percentage point this year, but they have slowed the pace of future cuts. However, Fed Chair Jerome Powell cautioned against putting too much weight on this outlook, warning of 'meaningful' inflation ahead as higher import tariffs loom. Elsewhere, platinum rose 1 per cent to $1,336.08. Earlier in the session, the metal hit $1,348.72, its highest level since September 2014. Platinum surges to 10-year high on supply concerns 'Platinum lease rates are high, so the refineries are not looking to manufacture because the cost is much higher. So demand is coming, but there's not enough supply… above ground inventory is tight,' said Brian Lan, managing director at GoldSilver Central, Singapore. Platinum lease rates refer to the cost of borrowing platinum for a set period of time. High lease rates can indicate a shortage of platinum in the market.
