Federal Reserve Chair Jerome Powell is scheduled to address the Jackson Hole symposium at the week’s conclusion. However, investors might not need to wait until that event for insights regarding the central bank’s forthcoming actions, as the minutes from the previous meeting are expected to be released later in the session. The Federal Reserve has kept its policy rate within the 4.25%-4.50% range throughout this year. Certain policymakers, notably Powell, have voiced concerns that the tariffs imposed by the Trump administration may lead to a resurgence of inflationary pressures. Nonetheless, this position has attracted significant criticism from President Donald Trump, while certain Federal Reserve officials have recently diverged from the consensus, advocating for a reduction in interest rates. The forthcoming minutes may reveal the extent of the divisions within the committee, particularly following the dissent expressed by Governors Christopher Waller and Michelle Bowman during the last meeting. This dissent marks a significant occurrence, as it is the first instance of two voting Fed officials disagreeing since 1993. Market participants anticipate that the Federal Reserve will implement a reduction in interest rates by 25 basis points in the upcoming month, with the possibility of an additional decrease of comparable magnitude later in the year. The annual Jackson Hole gathering commences with informal interviews preceding the formal agenda announcement scheduled for Thursday evening. Powell’s key address on Friday morning will concentrate on the economic outlook.

Dow futures experienced a decline on Wednesday, as investors approached the forthcoming release of the minutes from the recent Federal Reserve policy meeting with caution, alongside the anticipated earnings reports from several prominent retailers. At 03:00 ET (07:00 GMT), the S&P 500 futures experienced a decline of 12 points, representing a decrease of 0.2%. Similarly, Nasdaq 100 futures saw a drop of 75 points, equating to a 0.3% reduction, while Dow futures fell by 85 points, or 0.2%. The major indices exhibited a mixed performance on Tuesday, as the S&P 500 declined by 0.6% and the NASDAQ Composite experienced a drop of 1.5%, whereas the Dow Jones Industrial Average managed to close slightly higher. Market participants are expected to adopt a prudent trading approach on Wednesday in anticipation of the crucial release of minutes from the recent Federal Reserve policy meeting, as they look for insights regarding forthcoming monetary policy ahead of the Federal Reserve’s Jackson Hole symposium later in the week. Additionally, several major retailers are set to release their quarterly earnings, including Target, Lowe’s, and TJX, prior to the market opening. U.S. companies have reported their most significant earnings surprises in over three years for the second quarter, as per an analysis by Jefferies, noting that the “difference between actual & consensus earnings growth is 12.3%, the widest spread since 1Q’22.”

The U.S. government is considering the acquisition of equity interests in semiconductor companies that are beneficiaries of CHIPS Act subsidies aimed at establishing manufacturing facilities domestically. Apart from Intel, Commerce Secretary Howard Lutnick is also exploring deals with Micron Technology, Taiwan Semiconductor Manufacturing, and Samsung that would see Washington secure ownership interests in return for billions in grants, the report said. The proposed action represents a significant transformation in U.S. industrial policy, enabling the government to exert direct influence over firms that are crucial to national security. The White House has confirmed discussions with Intel regarding a potential acquisition of a 10% stake. According to the report, Washington allocated $6.6 billion to TSMC, $6.2 billion to Micron, and $4.75 billion to Samsung last year.

Target leads the earnings announcements on Wednesday, as attention continues to center on the retail sector this week, with reports expected from a variety of large retailers and home improvement chains. The underperforming retailer is set to announce its fiscal second-quarter earnings prior to the market opening, as investors seek indications of a recovery, particularly in light of the fact that annual sales have remained relatively flat for approximately four years. Analysts anticipate that the big-box retailer will disclose earnings per share of $2.03 and revenue amounting to $24.93 billion for the previous quarter, as indicated by a survey conducted by LSEG. “We see increasing longer-term sales and margin risks for Target given slowing digital sales growth, a lack of scale in digital advertising and third-party marketplace, elevated tariff, pricing and merchandising headwinds, and increasing competitive threats from Walmart and Amazon,” analysts at Bank of America said, in a note late last week. Market participants will closely monitor the retailer’s commentary on tariffs, given that Target’s imports constitute approximately 50% of its cost of goods sold, in contrast to Walmart’s 33%. Home Depot was the first of the major big-box retailers to report this week, with the U.S. home-improvement chain maintaining its annual forecasts despite presenting subdued quarterly results on Tuesday. Earnings are also due from Lowe’s Companies and TJX Companies before the open.

In July, the CEO of Tesla announced plans to establish a new political entity, termed the America Party, aimed at catering to constituents discontented with the existing Republican and Democratic parties. This development came after a significant disagreement with U.S. President Donald Trump, primarily due to Musk’s critique of Trump’s “big beautiful bill,” which he argued would hinder his initiatives aimed at reducing government expenditure within the Department of Government Efficiency. However, Musk has since made few actual moves towards establishing the third party, and the WSJ reported Musk as telling allies that he wants to focus his attention more on his companies and is reluctant to alienate powerful Republicans. The potential diminishment of Musk’s political aspirations is anticipated to provide a degree of comfort to Tesla shareholders, who have expressed rising apprehension regarding his focus on the core operations of the electric vehicle manufacturer.