MARKET SNAPSHOT
U.S. stocks rose and Treasury yields fell after Federal Reserve Chairman Jerome Powell said the U.S. has made "a lot of progress" on inflation and Labor Department data suggested the jobs market is gradually cooling to pre-pandemic norms. The dollar edged lower. Crude oil futures ended down, giving up early gains as concerns over Hurricane Beryl's impact on U.S. output eased. Gold prices slipped.
MARKET WRAPS
EQUITIES
A jump in Tesla shares helped the Nasdaq Composite and S&P 500 notch new highs on an otherwise quiet pre-holiday trading session.
Major indexes fluttered between small gains and losses throughout the day then veered higher before the closing bell. The tech-heavy Nasdaq edged up by 0.8%, for its 22nd record close of 2024, while the S&P 500 logged its 32nd of the year with a 0.6% increase. The Dow Jones Industrial Average advanced 0.4%.
Stocks and bonds largely shrugged after Federal Reserve Chair Jerome Powell said the U.S. has made "a lot of progress" on inflation and Labor Department data suggested the jobs market is gradually cooling to pre-pandemic norms.
Speaking at a conference in Portugal, Powell stopped short of saying the rate cuts that Wall Street is clamoring for are now justified. "We want to be more confident that inflation is moving sustainably down...before we start the process of loosening policy," he said.
Earlier Tuesday, Chinese shares ended mixed, with semiconductor stocks leading the losses. Investors will be watching China's Third Plenum closely for clues on officials' plans to tackle China's economic problems, particularly those related to the real-estate sector, said Roman Ziruk, senior market analyst at global financial services firm Ebury.
The benchmark Shanghai Composite Index gained 0.1%, the Shenzhen Composite Index settled 0.6% lower, while the ChiNext Price Index lost nearly 1.1%. The benchmark Hang Seng Index climbed 0.3%.
Japan's Nikkei Stock Average added 1.1%, led by gains in financial stocks thanks to expectations of potential rate increases by the Bank of Japan.
Australia's S&P/ASX 200 shed 0.4%, as the Reserve Bank of Australia continued to sound warnings about upside inflation risks.
New Zealand's NZX-50 slipped 0.1%, with healthcare stocks proving to be a drag.
COMMODITIES
Oil futures settled with a loss, with prices giving up early gains as concerns that powerful Hurricane Beryl could cause disruptions to offshore crude production in the Gulf of Mexico eased, for now.
Expectations for heavy travel around the Fourth of July holiday in the U.S. on Thursday, however, helped to limit losses for oil.
West Texas Intermediate crude for August delivery fell 0.7% to settle at $82.81 a barrel on the New York Mercantile Exchange. September Brent crude lost 0.4% to settle at $86.24 a barrel on ICE Futures Europe.
Traders have eased back on the hurricane price premium in oil, Phil Flynn, senior market analyst at the Price Futures Group, told MarketWatch.
Most of the storm predictions show Hurricane Beryl going south of some of the major oil platforms and rigs, Flynn noted. Still, "as the storm gets closer a few days out, we'll have to judge to see how much production gets shut in, if any," he said.
Gold prices slipped after the dovish tone of the U.S. Fed chairman's speech at a conference in Portugal.
Front month Comex gold for July delivery lost 0.2% to settle at $2323 per troy ounce.
TODAY'S TOP HEADLINES
Powell Talks Up Progress, Putting Rate Cuts Back Into View
Federal Reserve Chair Jerome Powell said he was pleased with how inflation had resumed a downtrend following a rebound at the start of the year, a sign the central bank might be able to lower interest rates by the end of the summer even though he declined to endorse such a move.
"We've made a lot of progress," Powell said Tuesday on a panel with other central bankers at a conference in Portugal.
The Fed leader's remarks underscored a sense of cautious optimism that had faded after disappointing inflation readings in April. He alternately said the economy had made "significant progress," "real progress" and "quite a bit of progress" toward cooler inflation with stable growth.
Job openings rebound, showing U.S. labor market is still pretty warm
The numbers: The number of job openings in the U.S. rebounded in May after falling to a more than three-year low, indicating there's still plenty of demand for labor.
Job postings rose to 8.1 million in May from 7.9 million in April, the Labor Department said Tuesday. Most of the increase was in government.
New openings have fallen from a record 12 million in 2022, but they are still higher than they were before the pandemic.
China and U.S. Both Eye Breakthrough EV Technology
China is so dominant in the market for the batteries powering electric vehicles and green tech that it would take a technological upheaval to change that. One might be coming, but Beijing isn't asleep at the wheel.
With a booming electric-vehicle market at home, Chinese battery makers are the giants of the industry. In the first four months of this year, just two companies from the country-Contemporary Amperex Technology, or CATL, and BYD-already have more than half of the global EV battery market between them, according to SNE Research. More crucially, Chinese manufacturers also dominate the supply chain for battery materials. China accounted for nearly 90% of cathode active material capacity globally and more than 97% for anodes, according to the International Energy Agency.
For countries such as the U.S. that wish to break China's dominance in the automotive and power technology of the future, the only hope would be a scientific breakthrough that could rejig the battery supply chain with different materials and components. New technology wouldn't replace existing lithium-ion batteries, which have been around for five decades, but could provide alternative options.
Approval of Newest Alzheimer's Drug Will Accelerate New Era of Treatment
The approval Tuesday of Eli Lilly's new Alzheimer's drug will hasten the transformation of treatment of the dementia-causing condition.
Until recently, Alzheimer's treatment was limited. Some patients diagnosed with the disease would take a pill to relieve symptoms. More wound up at facilities that provided care of them once they couldn't take care of themselves.
With drugs like Lilly's newly approved Kisunla coming online, Alzheimer's treatment promises to slow the cognitive decline, if only modestly, and to become more widely used.
Tesla Deliveries Slump but Not as Much as Feared
Tesla's vehicle sales slid for a second straight quarter but not as much as expected, lifting the company's stock price and keeping Tesla ahead of rival BYD as the world's largest seller of electric vehicles.
The company said it delivered 443,956 vehicles globally in the three-month period, a 4.8% decline from the same quarter a year ago. The decline comes as Tesla is contending with lukewarm demand for its cars and intensifying competition.
Tesla's slowing growth underlines the challenges facing the broader industry. Other carmakers have rolled out dozens of new electric models, but demand has fallen short of initial expectations, despite falling prices and a spurt of low-interest and lease deals.
Expected Major Events for Wednesday
00:30/JPN: Jun Japan Services PMI
00:30/SIN: Jun Singapore Whole Economy PMI
01:30/AUS: May Retail Trade
01:30/AUS: May Building Approvals
01:45/CHN: Jun China Services PMI
02:00/AUS: Jun VFACTS vehicle sales
All times in GMT. Powered by Onclusive and Dow Jones.
Write to us at singaporeeditors@dowjones.com
We offer an enhanced version of this briefing that is optimized for viewing on mobile devices and sent directly to your email inbox. If you would like to sign up, please go to https://newsplus.wsj.com/subscriptions.
This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
July 02, 2024 16:53 ET (20:53 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
