S&P 500 Holds Steady as Powell Signals Patience on Rate Cuts

The S&P 500 closed slightly higher on Tuesday as investors absorbed Federal Reserve Chair Jerome Powell’s cautious stance on interest rate adjustments. Concerns over U.S. tariffs and potential global trade tensions weighed on market sentiment.

The S&P 500 edged up 0.03% to 6,068.50, while the Nasdaq Composite slipped 0.36% to 19,643.86. The Dow Jones Industrial Average gained 123.24 points, or 0.28%, closing at 44,593.65. Apple shares rose 2.2% after reports of a partnership with Alibaba to develop AI features for iPhone users in China, helping limit market losses.

Powell, speaking before the Senate Banking Committee, emphasized that the Fed does not need to rush into policy changes. He described the economy as “strong overall” with a “solid” labor market but acknowledged that inflation remains above the 2% target. His testimony comes amid trade policy uncertainty, with President Donald Trump imposing new tariffs on steel and aluminum imports. The European Union has threatened retaliatory measures if further tariffs are introduced.

Investors are now turning their attention to upcoming inflation reports, with the consumer price index set for release on Wednesday and the producer price index following on Thursday. Analysts suggest that while market movement remains cautious, future gains will likely depend on earnings growth rather than multiple expansion.