Stocks were little changed Tuesday as market participants reacted to a cautious tone on interest rates from Federal Reserve Chair Jerome Powell. The Dow Jones Industrial Average climbed over 100 points, while the S&P 500 Index ticked above the flatline and the Nasdaq Composite fell 0.4%.
Here's how the market settled on Tuesday:
S&P 500 Index
Dow Jones Industrial Average
Nasdaq Composite Index
Fed Chair Jerome Powell on Tuesday reiterated the central bank's position on interest rates before the Senate Banking Committee, signaling that policymakers are waiting for more positive economic data before cutting rates lower.
"With our policy stance now significantly less restrictive than it had been and the economy remains strong, we do not need to be in a hurry to adjust our policy stance," Powell said. "We know that reducing policy restraint too fast or too much could hinder progress on inflation. At the same time, reducing policy restraint too slowly to too little could unduly weaken economic activity and employment."
Powell said the federal funds current benchmark range between 4.25% to 4.50% is providing alot of flexibility.
"We are attentive to the risks to both sides of our dual mandate, and policy is well positioned to deal with the risks and uncertainties that we face," he added.
Further FedSpeak:
Cleveland Federal Reserve President Beth Hammack said Tuesday that it is unlikely policymakers will lower interest rates as inflationary pressures remain high. Hammack is a nonvoter this year on the rate-setting Federal Open Market Committee. She will get a vote in 2026.
"Given the economy's momentum heading into 2025, and with a healthy labor market, we have the luxury of being patient as we assess the path forward for inflation," she said remarks delivered before a forum in Kentucky. "We have made good progress, but 2 percent inflation is not in sight just yet. As long as the labor market remains healthy, I am looking for broad-based evidence that inflation is sustainably returning to 2 percent before adjusting policy further."
On the Earnings Front:
Coca-Cola
"In North America, we grew both transactions and volume and had robust top line and profit growth during the quarter," CEO James Quincey told analysts during the company's earnings call. "Trademark Coca-Cola and Fairlife remain leaders in at home retail sales growth."
For 2025, Coke expects organic revenue to grow between 5% to 6%. The company also anticipates comparable earnings per share to increase between 2% and 3%, which includes a 6% to 7% headwind from currency exchange and acquisitions, divestitures and structural changes.
"It seems more likely in '25, there'll be a little more price and a little less volume, but there will be volume growth," Quincey added.
Shopify
"We expect the strong merchant momentum for Q4 to carry over into Q1, recognizing that Q1 is consistently our lowest [gross merchandise volume] quarter seasonally," the company said in a release.
Shopify's earnings come as President Donald Trump signed an executive order that temporarily restored de minimis trade, which allows merchants to import goods below $800 without customs duties or tariffs.
Shopify President Harley Finkelstein said on a call with investors that the de minimis exception is a "crucial" tool for small businesses, and called for greater reforms to the rule.
"I think rather than eliminating de minimis, countries should really try to streamline these custom processes and improve digital duty collection to make things a lot easier," he said.
For Wednesday:
Market participants will turn their attention towards January's Consumer Price Index reading as well as further testimony from Powell before Congress on Wednesday. Notable earnings reports for Wednesday also include DoorDash
