The Market News Today: Powell to Face Congress on Rate Cuts and Inflation

Fed Chair Powell to Face Congressional Grilling on Interest Rates

Federal Reserve Chair Jerome Powell is set to testify before Congress, addressing concerns about high borrowing costs and the potential for interest rate cuts. Powell will discuss the Fed’s balancing act between controlling inflation and avoiding recession. Lawmakers may press for rate cuts, citing housing affordability issues. Powell could also face scrutiny over proposed banking regulations. The Fed remains data-dependent on when to reduce rates, with recent unemployment data potentially influencing decisions.

BP Shares Fall on $2 Billion Impairment Warning and Weak Refining Outlook

BP’s shares dropped 2.6% following an announcement of potential impairments up to $2 billion in Q2. The company warned of weak refining margins and oil trading performance, estimating a $500-700 million hit. BP expects flat upstream production and average gas trading results. The energy sector is underperforming, with BP facing transition challenges after CEO Bernard Looney’s resignation. The company aims for $2 billion in cost savings by 2026, while rival Shell also anticipates impairments up to $2 billion.

S&P 500 and Nasdaq Hit New Highs as Markets Await Key Data

U.S. stock futures rose early Tuesday following record closes for the S&P 500 and Nasdaq Composite. Investors remain optimistic about potential Fed policy easing due to slowing inflation and growth. However, some advisors urge diversification, warning of a possible market correction. Markets anticipate Federal Reserve Chair Jerome Powell’s congressional testimony, June inflation data, and earnings reports from major companies like PepsiCo, Delta Air Lines, Citigroup, and JPMorgan Chase later this week.

Analysts Divided on Market Outlook as S&P 500 Hits New Highs

The S&P 500 continues its upward trajectory, reaching its 35th record high this year. Oppenheimer’s John Stolzfus raises his target to 5,900, the second-highest on Wall Street. However, Goldman Sachs’ Scott Rubner warns of a potential correction, citing overoptimism. Roger McNamee of Elevation Partners cautions about excessive AI investments, suggesting the end uses may not justify the costs. Ed Yardeni describes the market as in a “slow-motion melt-up.” Investors await upcoming economic data and corporate earnings for further direction.

Crypto Heists Soar: $1.38 Billion Stolen in First Half of 2024

Cryptocurrency thefts have more than doubled in the first half of 2024, reaching $1.38 billion according to TRM Labs. The top five hacks accounted for 70% of stolen funds. Major attack vectors include private key compromises and seed phrase theft. The largest heist targeted DMM Bitcoin, stealing over $300 million in bitcoin. While the number of attacks remains similar to last year, higher crypto prices may have contributed to the increased value of stolen assets. TRM Labs reports no significant changes in crypto ecosystem security.