US stock markets mixed after Fed comments and global tensions

The US stock market remained relatively stable for a second day in a row on Wednesday, but could be exposed to additional price corrections after three weeks of declines.

Traders could remain cautious in the wake of comments from Federal Reserve Chair Jerome Powell, who indicated that the Fed needs to observe further progress on inflation before considering rate cuts.

Powell’s remarks on Wednesday tempered market expectations for imminent reductions in borrowing costs, particularly as traders adjust their forecasts amid persistent inflation and a resilient US economy.

The ongoing tensions in the Middle East also add to market uncertainty, potentially escalating risk aversion if conditions worsen. Later today, investors will pay close attention to speeches from Fed Board Governor Michelle Bowman and Cleveland Fed President Loretta Mester. Additionally, the release of the Fed’s “Beige Book” will offer insights into the current economic conditions of the world’s largest economy.

The real estate sector remains a weak performer, impacted by shifts in monetary policy expectations. The earnings season continues to influence individual stock performances.

United Airlines saw a strong increase after reporting a narrower-than-expected loss and surpassing revenue expectations helping many airline stocks to be on the green side today.

Conversely, JB Hunt Transport Services experienced a drop after failing to meet Wall Street’s projections for the first quarter. Meanwhile, Megacaps stocks such as Microsoft, Amazon, and Alphabet show gains, potentially offering some support to the market amidst broader economic uncertainties.