Nasdaq Index, Dow Jones, S&P 500 News: Wall Street Weighs Powell’s Words as Treasury Yields Near 5%

Highlights

• Powell expected to maintain “hawkish pause.”
• Earnings reports show Tesla down, Netflix and AT&T up.
• 10-year Treasury yield nears crucial 5% mark.

Powell’s Speech, Mixed Earnings Drive Market Focus

Wall Street’s focus is squarely on Federal Reserve Chair Jerome Powell as he prepares to address the Economic Club of New York. Despite a slight uptick in the S&P 500 and Nasdaq, all eyes are on Powell, particularly after Treasury yields flirt with the elusive 5% mark. Analysts predict a “hawkish pause,” consistent with recent Fed language.

A Hawkish Powell Expected Amid Inflation Ups and Downs

Analysts expect Powell to stick to the script from his September comments, underscoring a data-dependent approach to monetary policy. Nuveen’s CIO Saira Malik warns that Powell is likely to lean more hawkish, citing a still-strong employment market and ongoing consumer spending.

Earnings Paint a Mixed Picture: Tesla Down, Netflix and AT&T Up

As Wall Street anticipates Powell’s speech, earnings reports offer a mixed bag. Tesla’s disappointing figures caused a 5% slide in its stock. Conversely, Netflix exceeded estimates, pushing shares up, and AT&T also impressed, registering a 4.8% stock hike.

Treasury Yields Approach a Crucial Benchmark

The 10-year Treasury yield is closing in on the critical 5% level, fueled by concerns over a ballooning U.S. fiscal deficit and the Federal Reserve’s willingness to let market rates curb the economy. Meanwhile, jobless claims remain impressively low, signifying enduring economic strength despite higher interest rates.

Short-Term Outlook: Cautious Optimism as Powell Takes Center Stage

Given Powell’s likely hawkish tilt and the mixed bag from earnings reports, the market seems prepared for cautious optimism. Traders remain in a watchful stance, keen for more concrete indicators from the Fed chair’s imminent speech.

Technical Analysis

The Nasdaq 100 Index is currently trading at 14937.48, hovering just below the 50-day moving average of 15044.59, suggesting near-term resistance. It’s also significantly above the 200-day moving average of 13826.69, indicating a longer-term bullish trend.

While the daily price shows a marginal uptick from the previous session, it’s too slight to be deemed a strong bullish signal.

Overall, based on its relation to the moving averages, the current market sentiment leans more towards bullish but warrants cautious optimism. Trader reaction to the 50-day moving average at 15044.59 is likely to set the tone on Thursday with Powell’s speech at 16:00 GMT the likely catalyst.