Wall Street falls on Jackson Hole jitters
The Nasdaq slid more than 1% to its lowest in over two weeks as megacaps Nvidia and Microsoft lost 3.37% and 1.22%, having rallied for much of the year.
The key event this week is the Fed's annual symposium at Jackson Hole, Wyoming, from Aug. 21-23, where Powell's comments will be scrutinized for any clues on the central bank's outlook on the economy and monetary policy.
'There's an anxiety about Powell's comments at Jackson Hole,' said Ross Mayfield, investment strategist at Baird Private Wealth Management. 'Some investors fear the Fed is going to be a bit behind the curve and higher interest rates have a big impact on growth stocks.'
Also on the policy front, remarks from Fed Vice Chair for Supervision Michelle Bowman are due later in the day.
Bowman, who is under consideration for the central bank's top job when Chair Jerome Powell's term ends next year, has voiced support for at least three
interest rate cuts this year, in line with President Donald Trump's calls for lower borrowing costs.
Interest rate futures point to a total of two rate cuts this year worth 25 basis points each, with the first expected in September, according to data compiled by LSEG.
At 01:45 p.m. the Dow Jones Industrial Average fell 0.59 points, roughly flat, to 44,911.23, the S&P 500 lost 34.25 points, or 0.53%, to 6,414.90 and the Nasdaq Composite lost 275.31 points, or 1.27%, to 21,354.46.
Six of the 11 S&P 500 sectors edged up. Real estate led with a 1.4% rise, helped by better-than-expected housing data.
On the other hand, technology and communications services lost over 1.5% and 1.2%, respectively.
The blue-chip Dow briefly hit a record high on Tuesday, aided by a rise in Home Depot's shares after the retailer kept its annual forecasts intact.
Home Depot rose 3.35% despite missing quarterly results estimates, while rival home-improvement chain Lowe's gained 2%.
Earnings from Lowe's and big-box retailers Walmart and Target later this week are now in focus as investors await more insight on the health of the American consumer.
'Consumers are still not really spending at full speed ahead, they're a little bit cautious,' said Peter Cardillo, chief market economist at Spartan Capital Securities.
'They're waiting to see the full results of the tariffs impact on the upcoming holiday sales in a couple of months from now.'
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