U.S. stocks little changed amid Powell's testimony
NEW YORK, June 25 (Xinhua) -- U.S. stocks wavered on Wednesday as investors weighed fresh remarks from Federal Reserve Chair Jerome Powell.
The Dow Jones Industrial Average fell by 106.59 points, or 0.25 percent, to 42,982.43. The S&P 500 dipped 0.02 points to 6,092.16. The Nasdaq Composite Index increased by 61.02 points, or 0.31 percent, to 19,973.55.
Eight of the 11 primary S&P 500 sectors ended in red, with real estate and consumer staples leading the laggards by losing 2.46 percent and 1.39 percent, respectively. Meanwhile, technology and communication services led the gainers by going up 1.18 percent and 0.51 percent, respectively.
After two days of congressional testimony, Powell reiterated the central bank's cautious stance, emphasizing that officials are still assessing the economic effects of U.S. President Donald Trump's tariff policies before deciding on interest rate cuts. While testifying before the Senate Banking Committee, Powell faced sharp questions from Republican senators, including pressure for Trump himself to move quickly to lower borrowing costs.
"There will be some inflation from tariffs coming -- not yet, but over the course of the coming months," Powell said, signaling the Fed's intention to wait for more data before taking action. His comments dampened investor enthusiasm sparked by his more dovish tone a day earlier, when he told the House of Representatives that rate cuts could come "sooner rather than later."
Meanwhile, tensions in the Middle East appeared to ease after Trump chastised both Israel and Iran for violating a ceasefire and urged them to honor the U.S.-brokered pause in hostilities. With no reported strikes between the two sides in over 24 hours, oil prices edged slightly higher, but the sense of calm helped keep broader market volatility in check.
On the economic front, sales of new single-family homes in the United States dropped sharply in May, falling 13.7 percent from April to a seasonally adjusted annual rate of 623,000 units, according to data released by the U.S. Census Bureau.
The May figure also marked a 6.3 percent decline compared to the same month in 2024 and came in well below both the six-month average of 671,000 and the one-year average of 676,000. It also trailed the pre-pandemic average from 2019, when monthly new home sales averaged 685,000 units.
"The large fall in new home sales in May cancels out all of the positivity of the past couple of months and serves as a valuable reminder that buyer activity can only rise so far with mortgage rates hugging 7 percent," said Bradley Saunders, an economist at Capital Economics.
Shares of the world's largest technology companies were mixed on Wednesday. AI chip giant Nvidia climbed 4.33 percent to a record high, while Alphabet rose 2.24 percent. Microsoft, Apple, and Broadcom all posted modest gains. In contrast, Tesla shares fell 3.79 percent after data showed the electric vehicle maker's sales in the European Union declined in May for the fifth consecutive month. Amazon and Meta Platforms each slipped less than 0.5 percent.
Market attention is now turning to Friday's release of the personal consumption expenditures (PCE) report, the Fed's preferred inflation gauge. Economists expect core PCE, which excludes food and energy, to have ticked up in May compared to April. Any sign that tariffs are beginning to feed through to consumer prices will be closely scrutinized.
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