Traders May Stick To The Sidelines Ahead Of Powell Speech

(RTTNews) - The major U.S. index futures are currently pointing to a roughly flat open on Tuesday, with stocks likely to show a lack of direction after trending higher over the past few sessions.

Traders may be reluctant to make significant moves ahead of remarks by Federal Reserve Chair Jerome Powell later this afternoon.

Powell is scheduled to speak on the economic outlook at the Greater Providence Chamber of Commerce 2025 Economic Outlook Luncheon.

The speech comes after the Fed announced its widely expected decision to lower interest rates by a quarter point last Wednesday.

In remarks following the decision, Powell described the move as a "risk management cut" amid some signs of weakness in the labor market.

The Fed is widely expected to continue cutting rates at its next two monetary policy meetings in October and December, and traders will be looking to Powell's remarks to shed additional light on the outlook for rates.

However, the Fed chief is likely to reiterate that future rate decisions will be based on incoming economic data such as Friday's closely watched readings on consumer price inflation.

After recovering from an initial move to the downside, stocks moved mostly higher over the course of the trading session on Monday. While the tech-heavy Nasdaq led the charge, the major averages all reached new record closing highs.

The major averages ended the day just off their highs of the session. The Nasdaq advanced 157.50 points or 0.7 percent to 22,788.98, the S&P 500 climbed 29.39 points or 0.4 percent to 6,693.75 and the narrower Dow inched up 66.27 points or 0.1 percent to 46,381.54.

Profit taking contributed to the initial weakness on Wall Street, with some traders looking to cash in on the recent strength in the markets.

Selling pressure waned shortly after the start of trading, however, as traders remain optimistic about the outlook for the markets amid expectations of further interest rate cuts by the Federal Reserve.

After cutting rates by a quarter point last Wednesday, the Fed is widely expected to lower rates by another quarter at each of its next two meetings in October and December.

Later this week, the Commerce Department is scheduled to release the Fed's preferred readings on consumer price inflation, which could impact the outlook for rates.

A number of Fed officials, including Fed Chair Jerome Powell, are also scheduled to deliver remarks over the next several days.

Meanwhile, traders largely shrugged off news that President Donald Trump has signed a proclamation to restrict the entry into the U.S. of certain H-1B aliens as nonimmigrant workers.

The White House said new H-1B applicants would be required to pay a $100,000 fee, with the move intended to "curb abuses that displace U.S. workers and undermine national security."

Gold stocks saw substantial strength as the price of the precious metal surged to a new record high, with the NYSE Arca Gold Bugs Index jumping by 3.0 percent to its best closing level in over thirteen years.

Computer hardware and semiconductor stocks also showed strong moves to the upside, contributing to the advanced by the tech-heavy Nasdaq.

On the other hand, housing stocks saw significant weakness on the day, dragging the Philadelphia Housing Sector Index down by 1.5 percent to a one-month closing low.

Commodity, Currency Markets

Crude oil futures are jumping $0.84 to $63.12 a barrel after slipping $0.12 to $62.28 a barrel on Monday. Meanwhile, after soaring $69.30 to $3,775.10 an ounce in the previous session, gold futures are climbing $35 to $3,810.10 an ounce.

On the currency front, the U.S. dollar is trading at 147.84 yen compared to the 147.72 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is trading at $1.1791 compared to yesterday's $1.1803.

Asia

Asian stocks ended mixed on Tuesday, with Japanese markets closed for a public holiday and Hong Kong preparing for Typhoon Ragasa, which is expected to pass the city in the next 24 hours.

Mainland Chinese and Hong Kong markets ended lower as technology stocks retreated from a stellar rally over the past month.

China's Shanghai Composite Index closed 0.2 percent lower at 3,821.83, recouping some earlier losses.

Suning.Com shares plunged 4.8 percent after the troubled retailer said its largest shareholder Alibaba Group Holding plans to cut its stake in the company.

Hong Kong's Hang Seng Index fell 0.7 percent to 26,159.12 after Pan Gongsheng, governor of the People's Bank of China, didn't announce any immediate policy changes at a high-level briefing on Monday.

Seoul stocks climbed to a new high for the second consecutive session following Wall Street's record-breaking rally, fueled by renewed optimism in big tech companies.

The Kospi climbed 0.5 percent to 3,486.19. Samsung Electronics gained 1.4 percent and SK Hynix rallied 2.9 percent amid improved sentiment for the global chip industry.

Australian markets ended higher for a third straight session after new Fed Governor Stephen Miran laid out his argument for aggressively lowering interest rates.

The benchmark S&P/ASX 200 Index rose 0.4 percent to 8,845.90, led by a rally by banks and miners. The broader All Ordinaries Index settled 0.4 percent higher at 9,137.80.

Cettire, which operates in online luxury fashion retail, surged 18.8 percent after Director Dean Mintz acquired an additional 10.7 million shares in the company.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 Index finished marginally lower at 13,136.54 amid unconfirmed reports of an appointment coming up of new Governor of the RBNZ.

Europe

European stocks have moved to the upside on Tuesday after a measure of Eurozone business activity hit a 16-month high in September.

The HCOB Flash Eurozone Composite Purchasing Managers' Index, compiled by S&P Global, edged up to 51.2 in September from 51.0 in August, marking the ninth consecutive month of growth, but new orders stagnated after briefly expanding in August.

While the services sector pulled up business activity, the manufacturing sector slumped back into contraction, clouding the outlook.

The French CAC 40 Index is up by 0.9 percent, the German DAX Index is up by 0.4 percent and the U.K.'s FTSE 100 Index is up by 0.2 percent.

In corporate news, home-improvement retailer Kingfisher has soared after lifting its expectations for the fiscal year.

Travel group TUI has also rallied after announcing that it is on track to deliver higher profit growth for fiscal 2025.

Engineering firm Smiths Group has also moved sharply higher after reporting stronger annual profit and lifting dividend.

Land Securities, a real estate investment trust company, has also jumped after backing its annual outlook.

U.S. Economic News

Federal Reserve Vice Chair for Supervision Michelle Bowman is scheduled to speak on the economic outlook at the 134th Annual Kentucky Bankers Association Convention at 9 am ET.

At 10 am ET, Atlanta Federal Reserve President Raphael Bostic is due to speak on the economic outlook during a Macro Musings podcast live recording.

Federal Reserve Chair Jerome Powell is scheduled to speak on the economic outlook at the Greater Providence Chamber of Commerce 2025 Economic Outlook Luncheon at 12:35 pm ET.

At 1 pm ET, the Treasury Department is due to announce the results of this month's auction of $69 billion worth of two-year notes.