Powell stressed the need to find a balance between controlling inflation and stable employment.
U.S. stock markets slumped on Tuesday, with Federal Reserve Chairman Powell stressing in an open speech that monetary policy is in a “sweet balance” phase, with rate cuts too early likely to push up inflation, while too slow could lead to unnecessary unemployment rises.
As of the closing, the Dow Jones Industrial Average Index fell 88.76 points, reaching 46292.78 points, falling 0.19%; the Standard Pur 500 index fell 36.83 points, reaching 6656.92 points, falling 0.55%; the Nasdaq Comprehensive Index fell 215.51 points, reaching 22573.47 points, falling 0.95%.
Big tech stocks generally under pressure, Amazon fell 3.04%, Nvidia fell 2.82%, Tesla fell 1.93%, Meta fell 1.28%, Microsoft fell 1.01%, Apple fell 0.64%, Google A fell 0.34%.
Also weakened, the Nasdaq China Gold Range Index fell by 2.22%, fell by more than 8%, fell by more than 5%, fell by more than 4%, fell by more than 3%, fell by almost 3%, and fell by 0.71% for Alibaba.
The preliminary value of the U.S. Purchasing Managers Index (PMI) released by S&P Global in September shows that the expansion of both manufacturing and service industries has slowed down. The initial value of the manufacturing PMI was reported at 52.0, lower than the final value of 53.0 in August, in line with market expectations.
Peter Cardillo, chief market economist at Spartan Capital Securities, said: “The main play of the day was Powell’s speech. He was somewhat predisposed to pigeons, but also showed caution, although leaving room for interest rates to drop again, but did not hint at the specific time and scale.”
The Federal Reserve’s vice president, Michelle Bowman, said the policy should focus more on the job market and called for promises to cut interest rates as soon as possible.
The interest rate futures market shows that investors expect the probability of the Federal Reserve cutting interest rates by 25 basis points at its October meeting to be about 92%, and the cumulative rate cut by the end of the year will be about 44 basis points.
In the bond market, the yield on the U.S. 10-year Treasury bond fell 2.6 basis points to 4.119%, and the yield on the two-year Treasury bond fell 0.9 basis points to 3.592%, both falling back from the previous trading day's high.
In terms of individual stocks, Boeing rose 2%, partially offsetting the Dow's decline. The company received a large order worth more than $8 billion from Uzbekistan Airways.
After the closing, Micron announced its results and upgraded its expectations, with the back-end stock price rising by 0.7%. The company expects revenue in the first quarter of the fiscal year of 2026 to be $12.2 billion to $12.8 billion, higher than the market average.
In terms of commodities, international oil prices rose on Tuesday, with WTI crude oil futures earning $63.41 per barrel, up 1.81%; Brent crude oil futures earning $66.97 per barrel, up 1.52%.
International gold prices hit a new high, with COMEX gold futures closing at US $3,815.7 per ounce, an increase of 1.08%.