Wall Street up ahead of second day of Powell testimony, earnings and inflation data

Wall Street was heading higher into Wednesday’s open after another record day for the S&P 500 and Nasdaq.

S&P 500 futures rose 0.2%, while Dow Jones Industrial Average futures rose less than 0.1%.

Investors are awaiting Federal Reserve Chairman Jerome Powell’s comments before a congressional committee and are eagerly awaiting earnings reports.

In testimony before the Senate Banking Committee on Tuesday, Fed Chairman Powell reiterated that inflation has fallen markedly over the past two years, although it has exceeded the central bank’s 2% target. There is a risk that the Fed cuts interest rates too late or too little, he said, warning that either scenario could weaken the economy and the job market.

Powell is scheduled to testify Wednesday before the House Financial Services Committee.

The U.S. releases new consumer price data on Thursday, with economists seeing it fall to 3.1% in June from 3.3% in May. A report on wholesale inflation, before costs are passed on to consumers, is due on Friday.

Investors are betting there is a 70 percent chance the central bank will cut its key interest rate as early as September, according to CME Group data.

The Federal Reserve has remained cautious on interest rates, keeping its benchmark interest rate at its highest level in more than two decades and cautiously waiting for further signs that inflation is continuing to decline.

The corporate earnings season will kick off this week when Delta Air Lines reports its second-quarter results on Thursday.

Quarterly reports from JPMorgan, Citigroup and Wells Fargo are due out Friday, which could provide more information on consumer debt levels and whether banks are worried about payments and potential delays.

Stock prices have been rising steadily over the past few months, helping the S&P 500 reach 36 records this year.

LegalZoom shares fell more than 28% after the online legal services company cut its 2024 revenue forecast and announced the departure of CEO Dan Wernikoff, who will be replaced by President Jeffrey Stibel.

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Apple continued its impressive run this year, gaining less than 1% in premarket trading after technology research firm IDC reported that the California tech giant’s PC shipments in the second quarter were up more than 20% from a year earlier. Apple has risen more than 30% since May, when the company announced a massive $110 billion stock buyback.

Elsewhere in Europe, Germany’s DAX and London’s FTSE 100 were up 0.6% at midday, while Paris’ CAC 40 gained 0.7%.

On the Asian stock market, Japan’s Nikkei 225 index closed at another record high, gaining 0.6% to end at 41,831.99. It also posted a record close on Tuesday and hit an all-time high of 41,889.16 on Wednesday.

Tokyo’s Nikkei 225 index is up almost 30% over the past year and 5% in the past three months.

Investors are buying up tech stocks as enthusiasm about the potential of artificial intelligence grows. Export-oriented companies also saw big gains as their profits soared amid a weakening Japanese yen against the U.S. dollar.

In Hong Kong, the Hang Seng index fell 0.2% to 17,479.12, while the Shanghai Composite index rose 0.7% to 2,939.36.

China said its consumer price index fell to 0.2% in June from 0.3% in May, a weaker-than-expected reading, mainly due to a drop in non-pork food prices.

“Weak consumer optimism continues to drive consumers to seek better value for money, while competition in the electric vehicle sector continues to drive down prices, which is keeping overall inflation in check,” Lynn Song of ING Economics said in a commentary.

Australia’s S&P/ASX 200 fell 0.2% to 7816.80.

In Seoul, the Kospi was nearly unchanged at 2,867.99. Taiwan’s Taiex gained 0.5% and India’s Sensex shed 0.7%.

In energy markets, U.S. crude fell 22 cents to $81.19 a barrel in electronic trading on the New York Mercantile Exchange.

Brent crude, the international standard, rose 26 cents to $84.40 a barrel.

The U.S. dollar rose to 161.47 Japanese yen from 161.34 yen. The euro rose to $1.0825 from $1.0813.

The S&P 500 and Nasdaq Composite rose 0.1% on Tuesday, enough to lift the indexes to record highs for the second time this week. The Dow Jones fell 0.1%.

Elaine Kurtenbach and Matt Ott, Associated Press