Fed Chair's Comments, Manufacturing Data Leave Equities Mixed Intraday

01:54 PM EDT, 07/01/2025 (MT Newswires) -- US benchmark equity indexes were mixed intraday as markets parsed remarks by Federal Reserve Chair Jerome Powell and latest manufacturing sector data.

The Nasdaq Composite was down 0.6% at 20,250.7 after midday Tuesday, while the S&P 500 fell 0.1% to 6,198.8. The Dow Jones Industrial Average rose 0.9% to 44,482. On Monday, the S&P 500 and the Nasdaq hit fresh closing highs.

Among sectors, communication services saw the biggest drop intraday Tuesday, while materials paced the gainers.

Powell indicated Tuesday that the Federal Open Market Committee would have lowered its benchmark lending rate by now had President Donald Trump not announced tariffs, CNBC reported.

Last month, the FOMC kept interest rates unchanged for a fourth consecutive meeting. Trump has repeatedly called on the Fed to reduce rates.

"In effect, we went on hold when we saw the size of the tariffs and essentially all inflation forecasts for the (US) went up materially as a consequence of the tariffs," Powell reportedly said Tuesday.

Markets are currently pricing in probabilities of 19% and 76% for a 25-basis-point rate reduction in July and September, respectively, according to the CME FedWatch tool.

"We are going meeting by meeting," Powell reportedly said Tuesday. "I wouldn't take any meeting off the table or put it directly on the table. It's going to depend on how the data evolve."

US Treasury yields were higher intraday, with the two-year rate jumping six basis points to 3.78% and the 10-year rate adding 3.9 basis points to 4.27%.

In economic news, two surveys painted a mixed picture of the US manufacturing sector for June, with Institute for Supply Management data showing a fourth straight monthly contraction and S&P Global (SPGI) indicating faster expansion.

The ISM survey's details point to "continued struggles" for domestic manufacturers, Oxford Economics said. "Demand uncertainty and bartering over who foots the tariff bill are leading to delays or cancellations in orders," the firm wrote. "Until tariff policies and geopolitical issues fade, this is unlikely to change."

West Texas Intermediate crude oil was up 0.7% at $65.54 a barrel intraday.

In company news, Tesla (TSLA) shares were down 4.6%, among the worst performers on the S&P 500 and the Nasdaq. The electric vehicle maker's investors are concerned that renewed tensions between Chief Executive Elon Musk and Trump could pose regulatory headwinds to the company's autonomous-driving journey, Wedbush Securities said in a client note.

The US leader suggested that the Department of Government Efficiency, which Musk led early in Trump's administration, should review any federal grants to Tesla and Musk's SpaceX. That came after Musk, Trump's former ally, stepped up criticism of the president's tax and spending bill.

The megabill bill passed in the Senate in a 51-50 vote Tuesday, proceeding to the House, which is expected to vote on the bill this week, CBNC reported.

AMC Entertainment (AMC) shares slumped 9.4% after the movie theater company said it secured more than $200 million in new funding as it looks to refinance debt maturing next year.

Packaging Corp. of America (PKG) agreed to purchase the containerboard business of Greif (GEF) for $1.8 billion in cash. Packaging Corp. shares were up 7.2%, among the top performers on the S&P 500, while Greif (GEF) jumped 5.8%.

Gold was up 1.4% at $3,355 per troy ounce, while silver increased 0.8% to $36.29 per ounce.

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