US open: Stocks lower following Powell comments
US stocks were in the red early on Monday following comments from Federal Reserve chairman Jerome Powell.
As of 1510 GMT, the Dow Jones Industrial Average was down 0.65% at 38,403.11, while the S&P 500 slipped 0.39% to 4,939.06 and the Nasdaq Composite came out the gate 0.44% weaker at 15,560.75.
The Dow opened 251.31 points lower on Monday, erasing gains recorded in the previous session on the back of a stronger-than-expected January jobs report and earnings beats from the likes of Microsoft and Meta Platforms.
However, futures headed south on Monday morning as Powell dashed hopes for any near-term interest rate cuts, echoing comments made by the head of the central bank at its most recent monetary policy meeting.
"We want to see more evidence that inflation is moving sustainably down to 2%," Powell said. "Our confidence is rising. We just want some more confidence before we take that very important step of beginning to cut interest rates."
On the macro front, S&P Global's US services purchasing managers' index came in at 52.5 in January, down from a preliminary reading of 52.9 but still its strongest reading in seven months. New orders increased on the back of improved demand conditions in the domestic market and the biggest rise in new export orders since August.
Elsewhere, the Institute of Supply Management's non-manufacturing PMI increased to 53.40 points in January, up from 50.50 points in December 2023.
In the corporate space, fast food giant McDonald's said conflict in the Middle East hit sales in the region and led to mixed fourth-quarter results, while Loews posted strong growth in revenues during Q4 on the back of higher premiums, and Estée Lauder beat earnings per share estimates by $0.34, while revenues topped estimates for its most recent quarter.
Still to come, Western Union and H&R Block will report earnings after the close.
Reporting by Iain Gilbert at Sharecast.com
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