The three major stock indices of the New York Stock Exchange started off slightly lower. Following a surge influenced by Jerome Powell's speech at Jackson Hole, they are undergoing a minor adjustment.
As of 9:50 a.m. local time on the 25th, the Dow Jones Industrial Average was recorded at 40,540.09, down 91.65 points (0.20%) from the previous session on the New York Stock Exchange. The Standard & Poor's (S&P) 500 index was down 13.88 points (0.21%) at 6,453.03, while the Nasdaq Composite index was pointing to 21,435.49, down 61.05 points (0.28%) from the previous session.
In his speech at Jackson Hole on the 22nd, Powell suggested the possibility of a rate cut at the Federal Open Market Committee (FOMC) meeting in September. He noted, "Considering the stability of the unemployment rate and other labor market indicators, we can carefully review changes to policy direction," while adding that "changes in the baseline outlook and risk balance could justify adjustments to the policy stance given the current restrictive environment."
However, following Powell's remarks, which caused the major stock indices to surge over 1% in the previous trading session, the market is experiencing a gentle adjustment today. Powell's remarks are not entirely dovish, and there seems to be a growing awareness that economic indicators emerging before the September meeting have become more significant.
The market also does not fully believe a cut in the benchmark interest rate will occur in September. According to the Chicago Mercantile Exchange (CME) FedWatch Tool, the federal funds futures market estimates an 86.2% probability that the benchmark rate will be cut by 25 basis points (1 basis point = 0.01%) in September.
By sector, all sectors are declining except for technology and communication services. Technology corporations with a market capitalization of over $1 trillion (1,388 trillion won) are mixed. Apple, Broadcom, and Alphabet are slightly positive, while the rest are slightly negative. The U.S. artificial intelligence (AI) defense contractor Palantir continues its sharp decline, falling 4.4% today. The U.S. semiconductor corporation Intel is slightly positive.