S&P 500 set to hit record high with Powell on deck

U.S. stocks were poised to resume their record climb on Tuesday as investors weighed concerns about a pullback ahead of Federal Reserve Chairman Jerome Powell’s speech.

Futures on the S&P 500 (ES=F) rose 0.2%, while those on the tech-heavy Nasdaq 100 (NQ=F) led the way with a 0.4% gain. Futures on the Dow Jones Industrial Average (YM=F) were little changed.

Stocks hit new all-time highs as signs of a U.S. economic slowdown strengthen bets on interest rate cutsThe benchmark S&P 500 index (^GSPC) posted its 35th record close of the year on Monday, while the Nasdaq Composite (^IXIC) set a record of its own as chip stocks outperformed.

Powell is expected to shed light on the Fed’s economic picture when he delivers his semiannual policy update to Congress, starting Tuesday with an appearance before the Senate. The following day, he will testify before the House, setting the stage for a key consumer inflation update Thursday — all potential catalysts for stocks if they confirm a slowdown.

But a note of caution is creeping into the market as the idea of ​​a summer pullback gains traction, with Morgan Stanley strategist Mike Wilson calling for a 10% correction.

Wall Street is having second thoughts about the upcoming earnings season, given the higher expectations it faces this time around. At the same time, investors are starting to question the massive investment flows into AI-related stocks that fueled the recent rally, given that the technology’s impact is still unproven.

In corporate news, U.S. shares of BP (BP) fell more than 4% in premarket trading after the energy giant warned of a decline in its refining business and a writedown of up to $2 billion on its plants. Meanwhile, Novo Nordisk (NVO) shares fell after Wegovy lost to Eli Lilly (LLY) subsidiary Mounjaro in an analysis of competing weight-loss drugs.