U.S. stocks were little changed on Thursday morning, ahead of the virtual Jackson Hole gathering of central bankers and the much-anticipated speech of Federal Reserve president Jerome Powell.
Initial jobless claims held near a pandemic low at 353,000 in the latest week.
“Pre-Powell speech positioning will likely dominate markets today (Powell’s speech is tomorrow) and given stocks hit new highs this week, don’t be surprised if there’s some mild profit taking ahead of Powell’s speech tomorrow,” writes Tom Essaye, founder of Sevens Report Research.
The market will listen for what Fed Chair Jerome Powell has to say about the future of the central bank’s bond-buying program. As the economy strengthened, the Fed has signaled that the process may begin soon, though the spread of the Delta variant has complicated matters.
“What investors want to hear is that, in response to an impressive improvement in the economy, the Federal Reserve is planning to gradually reduce their extraordinary measures because they’re not necessary anymore, but will do so incrementally,” says David Donabedian, chief investment officer of CIBC Private Wealth, US.
A survey showed the mood of German consumers darkening, one day after another one showed similar pessimism among German businesses.
Germany’s largest private lender, were down 1.4% after the Wall Street Journal reported that its management arm
was being investigated by U.S. regulators over claims it overstated efforts to use sustainable investing criteria to manage its assets. DWS Group shares were down more than 13% in early morning trading.
The South Korean central bank was the first Asian central bank to raise its key interest rate since the pandemic, to an anticipated 0.75%, and Governor Lee Ju-yeol hinted that it might tighten policy further in light of the fast-growing economy.
The yield on benchmark 10-year Treasury notes was 1.351% compared with its U.S. close of 1.344% on Wednesday.
Zoom Video Communications
(ZM) stock rose 4.7% after getting upgraded to Overweight from Equal Weight at Morgan Stanley.
(YUM) stock fell 1.8% after getting downgraded to Perform from Outperform at Oppenheimer.
(JWN) was down 4.8% after the department-store operator was downgraded to Underweight from Equal Weight at Morgan Stanley. Nordstrom stock dropped 18% on Wednesday after reporting earnings.