In the latest trading sessions, US benchmark equity indexes have experienced declines as investors await the release of the Federal Reserve's minutes from its July monetary policy meeting, set to be published on Wednesday. The Nasdaq Composite Index recorded a drop of 0.5%, settling at 17,787.8 during intraday trading.
The S&P 500 also faced a setback, falling 0.3% to 5,591.3, while the Dow Jones Industrial Average saw a decrease of 0.2%, closing at 40,830.5. Among the various market sectors, energy stocks encountered the steepest decline, plummeting by 2.2%. Conversely, sectors such as consumer staples, healthcare, and communication services witnessed positive performance, managing to stay in the green. Last month, the Federal Open Market Committee, a key component of the central bank, decided to maintain its benchmark lending rate within the range of 5.25% to 5.50%.
This marked its eighth consecutive pause in interest rate hikes, despite inflation levels remaining "somewhat elevated", although they have shown signs of easing over the past year. Since March 2022, policymakers have been on a trajectory of increasing interest rates to control inflation, with the most recent adjustment occurring in July 2023.
Investors are particularly keen on Fed Chair Jerome Powell's upcoming address at the annual economic symposium in Jackson Hole, Wyoming, scheduled for Friday. Market participants hope to glean insights regarding possible monetary easing and future economic policy directions. In the bond market, the US two-year Treasury yield has decreased by 6.8 basis points to 4%, while the 10-year yield has fallen by 4.5 basis points to 3.82%.
This decline in yields reflects the evolving expectations regarding interest rates and monetary policy. Turning to corporate news, Boeing ($BA) saw its share price tumble by 4.5%, marking the steepest decline on the Dow and one of the most significant drops within the S&P 500. This setback comes after Boeing announced it would ground its 777X test fleet following the discovery of cracks in an engine mounting structure, raising concerns over safety and aircraft reliability. Similarly, Lowe's ($LOW) reduced its full-year outlook due to disappointing sales results in its do-it-yourself segment, alongside a challenging macroeconomic landscape.
The home improvement company's fiscal second-quarter results showed a year-over-year decline, contributing to a drop of 1.5% in its share price. In contrast, Palo Alto Networks ($PANW) emerged as a standout performer on the S&P 500 and Nasdaq, witnessing an impressive rise of 8.8%. The cybersecurity firm reported a surprising increase in fiscal fourth-quarter earnings, driven by revenue that exceeded analysts' expectations, underscoring robust demand for cybersecurity solutions. Eli Lilly ($LLY) also reported positive news on Tuesday, revealing that its weight-loss medication has been shown to significantly lower the risk of progression to type-2 diabetes in adults classified as obese or overweight.
This encouraging data, derived from a comprehensive three-year study, led to a 2.1% increase in the company's stock price, helping it secure a position among the top gainers of the S&P 500. Additionally, companies such as Keysight Technologies ($KEYS), Toll Brothers ($TOL), and Coty ($COTY) are set to disclose their latest quarterly financial outcomes following Tuesday's market closure, garnering attention from investors eager to assess their performance amid a shifting economic landscape. In the commodities market, West Texas Intermediate crude oil traded down 0.5% to $74.02 per barrel, reflecting slight fluctuations in energy prices.
In contrast, the precious metals market showed some resilience, with gold rising 0.4% to $2,550.30 per troy ounce, while silver enjoyed a gain of 0.8%, reaching $29.53 per ounce. This mixed performance across different asset classes underscores the complexity of the current financial environment as markets navigate uncertainties ahead..