US stocks edge higher as investors await day 2 of Powell testimony on state of economy
- US stocks edged higher on Thursday as investors await day 2 of Fed Chairman Jerome Powell's testimony to Congress.
- Powell told the Senate on Wednesday that managing a soft economic landing will be "very challenging."
- Powell reiterated his plan to continue raising interest rates in a bid to tame inflation back to the 2% level.
US stocks edged higher on Thursday as investors await a second day of Fed Chairman Jerome Powell's testimony to Congress on the state of the US economy.
On Wednesday, Powell told the Senate that managing a soft economic landing will be "very challenging" as inflation hits 40-year highs and interest rates surge higher, making it more expensive for consumers to borrow money to buy everything from a house to a car.
Powell's testimony was relatively hawkish on Wednesday, as the Fed Chair reiterated plans to continue its interest rate hiking and balance sheet reduction plans in a bid to tame inflation back to its 2% target level. Helping Powell's cause for lower inflation has been lower energy prices in recent days, as WTI Crude oil fell to just above $100 per barrel, representing its lowest price since early May.
Here's where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:
- S&P 500: 3,777.34, up 0.46%
- Dow Jones Industrial Average: 30,602.88, up 0.39% (119.75 points)
- Nasdaq Composite: 11,103.44, up 0.46%
Partly driving the decline in oil prices has been fears of an economic recession, which would ultimately destroy demand for the commodity as travel declines. A rising number of commodities traders anticipate that crude prices will tumble 25% by December, according to data from the New York Stock Exchange.
"Worries about recession and its potential negative impact on demand [are ripping] through cyclical commodities like oil," Saxo Bank strategists said.
Despite the recent decline in oil prices, Berkshire Hathaway's Warren Buffett still sees an opportunity in the space, as the billionaire investor boosted his stake in Occidental Petroleum.
Berkshire Hathaway bought another $529 million in Occidental Petroleum stock this month, new SEC filings show. Buffett now commands a 16% stake in the oil and gas company, worth about $8.5 billion.
Bitcoin rose 1.85% to $20,573. Ether prices jumped 3.83% to $1,116.
Gold fell as much as 0.07% to $1,837.10 per ounce. The yield on the 10-year Treasury fell 8 basis points to 3.08%.
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