REUTERS/Brendan McDermid
- US stocks traded mixed on Tuesday as investors worried about a longer inflation fight from the Fed.
- The Minneapolis Fed president warned the US has more work to do to lower high prices.
- Investors are expecting rates to remain elevated for most of 2024, which could weigh on stocks.
US stocks traded mixed on Tuesday as traders adjusted expectations for rate cuts and priced in a longer inflation fight from the Fed.
The S&P 500 and Dow Jones Industrial Average ticked lower in early morning trading, though the Nasdaq Composite edged higher, after having notched its seventh-straight winning session on Monday.
Investors are digesting comments from Minneapolis Federal Reserve president Neel Kashkari, who said yesterday that rates could move higher still and stay higher for longer as central bankers keep a hawkish eye on inflation. Prices remain well-above the Fed's 2% inflation target, accelerating 3.7% year-per-year in September.
"We haven't completely solved the inflation problem," Kashkari said in an interview with Fox News on Monday. "We still have more work ahead of us to get it done."
Investors are largely expecting rates to remain elevated through 2024. Markets are pricing in a 94% chance rates will stay above 4% by December of next year, per the CME FedWatch tool.
In the meantime, traders will have their eye on the October inflation report, which the Bureau of Labor Statistics is set to roll out next Tuesday.
Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Tuesday:
- S&P 500: 4,357.84, down 0.19%
- Dow Jones Industrial Average: 34,052.34, down 0.13% (-43.52 points)
- Nasdaq Composite: 13,530.48, up 0.09%
Here's what else is going on today:
- Jamie Dimon warns conflict in the Middle East could trigger the most serious global crisis since World War II
- Brace for wild swings in US stocks amid elevated interest-rate uncertainty, wealth manager says
- Bond-market crash leaves big banks with $650 billion of unrealized losses as the ghost of SVB continues to haunt Wall Street
In commodities, bonds, and crypto:
- West Texas Intermediate crude oil dipped 2.19% to $79.05 a barrel. Brent crude, the international benchmark, fell 2.10% to $83.39 a barrel.
- Gold slipped 0.55% to $1,966.95 per ounce.
- The 10-year Treasury yield dipped five basis points to 4.604%.
- Bitcoin fell 0.93% to $34,760.