U.S. stocks were falling as investors prepared to hear Federal Reserve Chair Jerome Powell testify in Congress that the central bank has more work to do to tame inflation.
At 9:52 ET (13:52 GMT), the Dow Jones Industrial Average was down 132 points or 0.4%, while the S&P 500 was down 0.4% and the NASDAQ Composite slipped 0.7%.
In prepared remarks, Powell said the Fed still had more work to do to quash inflation. “The process of getting inflation back down to 2% has a long way to go,” Powell said in the testimony. He is appearing at 10:00 ET (14:00 GMT) in the House Financial Services Committee for his semi-annual testimony.
Futures traders expect the Fed will raise rates a quarter of a percentage point when it next meets in July, after pausing on rate hikes at its most recent meeting last week. The Fed has been trying to nudge inflation back toward its 2% target.
Powell’s written remarks note that even as the Fed held off raising interest rates at the meeting last week “nearly all” participants expect further rate increases will be appropriate by the end of the year
Stocks had been rallying in anticipation of the Fed nearing the end of its interest rate hikes, but that rally has stalled in the last few trading sessions.
Shares of FedEx Corporation (NYSE:FDX) were flat after the logistics giant reported a drop in quarterly earnings, saying a global shipping downturn has hurt margins for the sector.
Shares of Chinese electric vehicle makers jumped after the country unveiled tax breaks to boost EV sales. Li Auto Inc. (NASDAQ:LI) stock rose 5.7%, while Nio Inc. Class A ADR (NYSE:NIO) rose 3%, and Xpeng Inc. (NYSE:XPEV) rose 2%.
Amazon.com, Inc. (NASDAQ:AMZN) announced its annual sale called Prime Day will be July 11 and 12, adding invite-only deals this year. Shares rose 0.2%.
Oil ticked higher. Crude Oil WTI Futures was up 0.5% to $71.58 a barrel, while Brent Oil Futures was up 0.4% to $76.20 a barrel. Gold Futures was down 0.6% to $1935.
