Stock Market Today: Dow closes lower as Fed's Waller dents early rate-cut hopes
Investing.com — The Dow closed lower Tuesday as investors digested a slew of earnings and a jump in Treasury yields after Fed Governor Christopher Waller downplayed the need for speed on rate cuts.
By 16:00 ET (21:00 GMT), the Dow Jones Industrial Average was down 231 points, or 0.6%, the S&P 500 fell 0.4% and the NASDAQ Composite dropped 0.2%.
Federal Reserve Governor Christopher Waller said he expects the Fed to cut rates this year, but stressed that there was no need to the central bank to cut rates quickly as the economy remains in good shape. The remarks cooled some optimism for a cuts to begin in March, sending Treasury yields sharply higher.
The yield on the 10-year Treasury topped 4%, while the 2-year Treasury rose 9 basis points to 4.2%.
«In many previous cycles [...] the FOMC cut rates reactively and did so quickly and often by large amounts,» Waller said Tuesday. "[H]owever, with economic activity and labor markets in good shape and inflation coming down gradually to 2 percent, I see no reason to move as quickly or cut as rapidly as in the past," he added.
Goldman Sachs (NYSE:GS) rose nearly 1% after reporting better-than-expected fourth-quarter results as strength in equity sales and trading helped offset weakness at the Wall Street giant's core investment banking unit.
Morgan Stanley (NYSE:MS) reported mixed fourth-quarter results as earnings fell short of analyst expectations after profit was hurt by $535 million in charges. Its shares fell 4.2%.
PNC Financial Services Group Inc (NYSE:PNC), meanwhile, ended roughly flat after delivering a beat on the top and bottom lines, though the super regional bank also provided a soft outlook for 2024, forecasting revenue to be flat to down 2% from $21.5B in 2023.
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