US equities moved within a tight band ahead of Federal Reserve Chair Kevin Warsh's address at Jackson Hole, with traders seeking clarity on his economic outlook and strategy for steering inflation back toward target. S&P 500 futures held steady, with the index still on track for a weekly gain, while Nasdaq 100 futures gave back a portion of the gains fueled by Nvidia's robust earnings forecast, slipping 0.2%. Dow futures edged up 0.2%.
PayPal dropped 14% in premarket trading after Advent and Stripe abandoned their acquisition plans for the company. Warsh is scheduled to speak at 10 a.m. New York time, and the address is shaping up as a pivotal moment for markets amid lingering doubts about his commitment to containing inflation, which has pushed long-term Treasury yields higher. Internal divisions within the Fed's policy committee, along with recent Treasury market interventions by the finance ministry, have further complicated the backdrop.
Nabil Milali of Edmond de Rothschild Asset Management noted that investors are hesitant to increase risk exposure with Warsh's speech imminent. His recent remarks have been too ambiguous for anyone to anticipate what to expect today, with some investors bracing for a very hawkish tone while others predict the complete opposite. Hugh Gimber, global market strategist at JPMorgan Asset Management, added that what investors want to see is the framework the Fed uses to assess the economy, allowing markets to better evaluate incoming data—a missing piece at present.
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