Stock Market Update
The US stock market experienced a decline on Tuesday, with the Dow, S&P 500, and Nasdaq all ending lower. This marked the end of a three-day winning streak for Wall Street. The decline was largely attributed to a speech by Federal Reserve Chair Jerome Powell, who signaled that the central bank would proceed cautiously on further rate cuts and suggested that equities were "fairly highly valued."
Morning Trading
Early trading on Wall Street was inconsistent, with the Dow Jones up 0.6% but the Nasdaq down 0.3%. The S&P 500 was relatively flat, up only three points at 6,697. Gains for Boeing, Chevron, Caterpillar, and Johnson & Johnson lifted the Dow, while losses for Nvidia, Microsoft, and Amazon dragged on the Nasdaq.
Powell’s Speech
During his speech in Rhode Island, Powell said he sees a "challenging situation" ahead for the Fed. His comments weighed on the market, particularly on the Nasdaq, which slipped 0.5%. Nvidia’s shares were down 2.5%, contributing to the decline.
Market Closing
The Nasdaq led the decline in the overall market, slipping nearly 1% to 22,574. The S&P 500 gave back 0.6% to 6,657, and the Dow edged 0.2% lower to 46,293. Weighing on the Nasdaq were shares of Nvidia, which ended down 2.8% a day after the AI chip giant announced a $100 billion investment in OpenAI.
Other Market News
In other market news, atai Life Sciences and Beckley Psytech announced promising results for their experimental nasal spray for depression. T Stamp Inc introduced a "pioneering advancement" in digital identity and age verification with the introduction of Zero-Knowledge Proofs (ZKP) for remote human presence. Aftermath Silver Ltd provided an outline of planned drilling for the Challacollo silver-gold project in Chile.
Global Economic Forecast
The Organisation for Economic Co-operation and Development (OECD) upgraded its global economic growth forecast to 3.2% this year, from its 2.9% estimate in June. The forecast for the US economy was also lifted to 1.8%, from 1.6%. The OECD sees 1.5% growth for the US in 2026, representing a sharp fall from the 2.8% growth in 2024.
Conclusion
The decline in the US stock market on Tuesday was largely attributed to Powell’s cautious comments on further rate cuts. The market will likely remain volatile in the coming days, with investors keeping a close eye on economic data releases and Fed speeches. Despite the decline, the OECD’s upgraded global economic growth forecast provides a positive outlook for the global economy. As the market continues to evolve, it’s essential for investors to stay informed and adapt to changing market conditions.
