S&P 500, Nasdaq Dip as Powell Stays Cautious on Cuts
The U.S. equity markets showed conflicting results on Tuesday because investors processed Federal Reserve Chair Jerome Powell's cautious statements while watching the Senate review President Donald Trump's large tax-and-spending bill.
The S&P 500 and Nasdaq Composite showed a decline after achieving record highs during the previous trading day. The Dow Jones Industrial Average rose in value to reach within 750 points of its historical peak.
Powell stated that the Fed will maintain its stance of waiting for additional information before making any interest rate adjustments despite Trump's persistent demands for rapid monetary easing. The administration plans to reveal its shortlist of candidates to replace Powell when his term expires in May 2019.
The Senate conducted an extended voting process on Trump's $3.3 trillion "One Big Beautiful Bill" which contains tax reductions together with enhanced defense spending and reduced welfare benefits. Treasury Secretary Scott Bessent predicted the bill would pass during the current day but Trump suggested the July 4 deadline might be postponed.
The stock price of Tesla declined by 4.5% because of the intensified dispute between Trump and CEO Elon Musk regarding subsidy reductions in the bill. Musk made threats of political action which added to the already high level of volatility in the tech stock market.
The market continues to show caution about fiscal uncertainty because investors need to understand policy results and rate direction expectations.
Dominic Maley is an American journalist recognized for his sharp and insightful reporting on social and political issues. His work is known for its depth, integrity, and the ability to highlight critical societal concerns.