Market Snapshot: S&P 500 struggles to hold gains as Powell says no guarantee of soft landing for U.S. economy

by | Jun 29, 2022 | Stock Market

U.S. stock indexes traded mixed Wednesday, as investors tuned in to remarks by central bankers while fretting that soaring inflation is damaging the world’s biggest economy.How are stock indexes trading?
The Dow Jones Industrial Average
 was up 78 points, or 0.3%, to 31,029.

The S&P 500
 edged down 3 points, or 0.08%, to 3,818.

The Nasdaq Composite
lost 13.7 points, or 0.1%, to 11,168.

On Tuesday, the Dow fell 491.27 points, or 1.6%. The S&P 500 fell 2% and the Nasdaq Composite dropped 3%. All three booked their worst daily percentage declines since June 16, according to Dow Jones Market Data.

What’s driving markets? The Dow remains higher from yesterday, but the number of declining stocks is outnumbering advancers 1,958 to 876 on the New York Stock Exchange and 2,426 to 1,120 on the Nasdaq. Federal Reserve Chair Jerome Powell said Wednesday at a European Central Bank forum on central banking that he sees a path back to 2% inflation while sustaining strong labor market, but warned there was “no guarantee that we can do that.” Investors were also listening to remarks from European Central Bank President Christine Lagarde, Bank of England Gov. Andrew Bailey and Augustin Carstens, head of Bank for International Settlements, at the same conference. On U.S. economic data, the first-quarter GDP was revised to show an 1.6% decline, compared with the prior 1.5% drop. “I think the biggest conundrum we have right now is we have not had an earnings recession, the analysts remain positive in this quarter,” Louis Navellier, chairman of Navellier & Associates, said in an interview. However, corporate profit margins are under pressure as inflation remains heated, Navellier noted. “This is going to be a very interesting quarter where I’ve never seen a recession where their earnings are still accelerating,” according to Navellier.  Equities were limping toward the end of a miserable first half of the year. The S&P 500 is down 19.6% so far in 2022 — on track for the worst first-half performance since 1970 — hit by concerns that inflation rates at multidecade highs are badly damaging household sentiment and that the Federal Reserve’s response to surging prices may tip the economy into recession. Read: What’s next for the stock market after the worst 1st half since 1970? Here’s the history. On Tuesday, the Conference Board’s consumer-confidence index dropped in June to a 16-month low of 98.7, with consumers’ outlook on the state of the economy at the most cautious in nearly 10 years. The news helped turn early gains for Wall Steet into heavy losses, with the Nasdaq Composite shedding 3% …

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