The Dow Jones Industrial Average has erased pre-open losses to gain more than 100 points following the release of the text of Fed Chair Jerome Powell’s prepared comments.
The Dow has advanced 111.72 points, or 0.4%, to 26,895.21, while the S&P 500 has risen 0.5% to 2993.75, and the Nasdaq Composite has gained 0.7% to 8199.59.
In the prepared text, Powell notes that investment has slowed because of trade fears, that economic growth may have slowed, and that uncertainties that have emerged since the May meeting have made the economic outlook more uncertain. “Apparent progress on trade turned to greater uncertainty, and our contacts in business and agriculture report heightened concerns over trade developments,” the text says. “Growth indicators from around the world have disappointed on net, raising concerns that weakness in the global economy will continue to affect the U.S. economy.”
To outside observers, this looks like preparation for at least one rate cut in July, and more to follow.
“Looks like we are going to get the ‘Dove’ Scenario,” writes NatAlliance Securities’ Andrew Brenner.
“Powell’s prepared testimony struck a decidedly dovish cord with ‘uncertainties’ over trade and global growth SINCE the June FOMC meeting characterized as having dimmed the outlook,” writes BMO’s Ian Lyngen.”
And the market apparently agrees.
Markets Now is a quick take on what’s happening with the Dow Jones Industrial Average and other major market indexes. Don’t forget to check out the rest of Barron’s markets coverage.
Write to Ben Levisohn at Ben.Levisohn@barrons.com
https://www.barrons.com/articles/dow-jones-industrial-average-erases-losses-after-jerome-powell-testimony-released-51562762982
2019-07-10 15:07:00Z
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