Wall Street Stays Volatile Amid Geopolitical Tensions and Rate Cut Expectations

U.S. stocks closed mixed as traders weighed Trump?s meetings with global leaders, Fed rate cut odds, earnings outlook and global market swings.

The tech-heavy Nasdaq inched up 6.80 points (less than a tenth of a percent) to 21,629.77, the S&P 500 edged down 0.65 points (less than a tenth of a percent) to 6,449.15 and the Dow slipped 34.30 points (0.1%) to 44,911.82.

Wall Street trading remained choppy as investors monitored geopolitical developments, including President Trump?s meetings with Ukrainian President Zelenskyy and European leaders following his recent talks with Putin. Attention also turned to upcoming earnings from major retailers Walmart and Home Depot, alongside the highly anticipated Jackson Hole Economic Symposium. Federal Reserve Chair Jerome Powell?s remarks on Friday are expected to provide key signals on the future path of interest rates.

According to CME Group's FedWatch Tool, there is an 83.2% chance the Fed will lower interest rates by a quarter point at its next monetary policy meeting in September. The National Association of Home Builders released a report showing a modest deterioration by U.S. homebuilder confidence in the month of August. The report said the NAHB/Wells Fargo Housing Market Index edged down to 32 in August after inching up to 33 in July.

Natural gas stocks notable moved downwards, with the NYSE Arca Natural Gas Index falling by 1.5% amid a decrease by the price of the commodity. Commercial real estate stocks too were weak while oil service stocks moved higher along with the price of crude oil, driving the Philadelphia Oil Service Index up by 1.2%.

Asia-Pacific stocks turned in a mixed performance. Japan's Nikkei 225 Index advanced by 0.8% while Hong Kong's Hang Seng Index fell by 0.4%. The major European markets also ended the day mixed while the U.K.'s FTSE 100 Index rose by 0.2%, the German DAX Index dipped by 0.2% and the French CAC 40 Index declined by 0.5%.

In the bond market, treasuries saw modest weakness, extending the downward move seen over the two previous sessions. As a result, the yield on the benchmark ten-year note which moves opposite of its price, inched up by 1.3 bps to 4.34%.

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