Stocks Slip After Powell's Rate Cut Remarks

US stock indexes slipped Wednesday as doubts rose about whether the Federal Reserve will deliver economy-juicing cuts to interest rates by September.

• The S&P 500 fell 7.96 points, or 0.1%, to 6,362.90.
• The Dow Jones Industrial Average fell 171.71 points, or 0.4%, to 44,461.28.
• The Nasdaq composite rose 31.38 points, or 0.1%, to 21,129.67.

Stocks felt pressure from rising Treasury yields after the Fed voted to hold its main interest rate steady. The move may upset President Trump, who has been angrily lobbying for lower interest rates, but it was widely expected. What may have surprised investors more was Fed Chair Jerome Powell's pushing back on expectations for a September cut, the AP reports. "We have made no decisions about September," he said.

Two members of the Fed's committee have also been pushing for lower rates to ease the pressure on the economy, and they dissented in Wednesday's vote. But Powell pointed to how inflation remains above the Fed's 2% target, while the job market still looks to be "in balance." Powell said that tariffs are starting to push up the cost of goods, while the price of services—rents, insurance, and hotel rooms—has continued to cool, the AP reports. He suggested it could take some time to determine whether the tariffs are having a one-time effect or are pushing up prices more persistently. "We think we have a long way to go to really understand exactly how" the tariffs and prices will play out, Powell said.

• Powell's comments drove traders to pare back bets on a cut in September. They now see just a 48% chance of that, down from a nearly 65% probability a day earlier, according to data from CME Group.

On Wall Street, stocks were mixed as most big US companies continue to report profits for the spring that were bigger than analysts expected.

• Humana rose 12.4% after the insurer and health care giant reported stronger results for the spring than expected. It also raised its forecasts for profit and revenue over the full year.
• Video-game maker Electronic Arts climbed 5.7% after likewise topping Wall Street's expectations. The company said it saw better-than-expected contributions from EA Sports and other games, and it will reveal its new Battlefield game on Thursday.
• Trane Technologies tumbled 8.4% even though it reported a stronger-than-expected profit for the latest quarter. The heating, ventilation, and air conditioning company's revenue came up short of analysts' estimates, as did its forecast for profit in the current quarter.
• Starbucks swung from a gain to a loss of 0.2% after it reported a weaker profit than analysts expected as it tries to turn around its operations.
• Palo Alto Networks fell 5.6% after saying it would buy CyberArk, an identity-security company, for $25 billion in cash and stock. CyberArk shares rose 0.2%.