© Reuters.
By Liz Moyer
Investing.com — Stocks drifted lower on Monday, unable to muster a rally ahead of a key appearance by Federal Reserve Chair Jerome Powell and the State of the Union address on Tuesday night.
An exceptionally strong last Friday spooked that the Fed would continue to raise rates. Powell has indicated as such because the central bank has more work to be done to tame inflation, but the market has been hoping that a pause in rate hikes is in the offing at some point this year, perhaps as early as the summer.
President Joe Biden is expected to use his annual speech to emphasize his policy and legislative victories, at 53-year lows, and progress on bringing down. But he still faces other challenges, including getting Republicans to agree to raise the debt ceiling before the early June deadline, at which point the U.S. faces the risk of default.
That task is a little trickier now that the Republicans control a razor-thin margin in the House and have asked for spending cuts in return for agreeing to lift the borrowing limit. Democrats have insisted on passing a “clean” bill without any strings attached.
Earnings continue to roll out this week, with Walt Disney (NYSE:), Uber Technologies (NYSE:) and PepsiCo (NASDAQ:) being among them.
Here are three things that could affect markets tomorrow:
1. Powell speaks
Powell is scheduled to attend a lunch event Tuesday at the Economic Club of Washington, D.C., and is slated to around 12:40 ET (17:40 GMT) in a question and answer format.
2. BP earnings
Oil major BP PLC ADR (NYSE:) is expected to report earnings of $1.66 a share on revenue of $55.7 billion.
3. Chipotle Mexican Grill earnings
Burrito chain Chipotle Mexican Grill Inc (NYSE:) is expected to report earnings per share of $8.92 on revenue of $2.23B.
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