S&P500 and Dow Jones: US Indices Under Pressure as Jackson Hole Sparks Uncertainty

Wall Street Dips as Traders Eye Fed Clues from Jackson Hole

Wall Street’s major indexes slipped on Tuesday amid volatile trading as investors turned cautious ahead of the Federal Reserve’s Jackson Hole symposium and the release of minutes from the central bank’s latest meeting. The market’s focus is on potential signals from Fed Chair Jerome Powell regarding a possible interest rate cut in September.

Despite the slight late session setback, the benchmark E-mini S&P 500 Index futures contract remains on the strong side of the 50-day moving average at 5522.56, and within striking distance of the record high at 5721.25.

Daily E-mini S&P 500 Index

Sectors and Stocks Under Pressure

Seven of the 11 major S&P sectors traded lower, with the energy sector leading the decline, falling 2.4%. Chip stocks also faced downward pressure, dragging the Philadelphia Semiconductor Index down by 1.1%. Concerns over economic data and Fed policy have kept traders on edge, particularly ahead of Powell’s anticipated speech on Friday.

Market participants are keen to interpret Powell’s remarks for any indication of a rate cut next month. Win Thin, Global Head of Market Strategy at Brown Brothers Harriman, noted that while Powell might hint at a cut, he will likely emphasize the Fed’s data-dependent approach and avoid committing to a more aggressive easing stance.

Fed Meeting Minutes and Rate Cut Odds

The release of the minutes from the Fed’s last meeting on Wednesday could provide further clarity on the central bank’s thinking. Currently, the CME FedWatch Tool indicates a 73.5% probability of a 25 basis point rate cut in September, a shift from the more uncertain outlook just a week ago.

Notable Stock Movements: Lowe’s and Palo Alto Networks

In corporate news, Lowe’s slipped nearly 1% after the home improvement retailer cut its annual profit and sales forecasts, echoing concerns raised by its competitor Home Depot about the weakening demand in the home improvement sector. The outlook for a recovery in this space remains dim, contributing to the stock’s decline.

Conversely, Palo Alto Networks surged 8.5% following its strong fiscal 2025 guidance, which exceeded market expectations for both revenue and profit. This optimistic forecast reflects the company’s confidence in its cybersecurity offerings, which continue to see robust demand despite broader economic uncertainties.

Market Outlook

With traders closely watching the Jackson Hole symposium and the upcoming Fed minutes, the short-term market outlook remains cautious. A clearer signal from Powell regarding a September rate cut could shift sentiment, but until then, volatility is likely to persist.