What's moving markets today: July 10, 2019

4:08 p.m. ET, July 10, 2019

Stocks close higher, Nasdaq hits new record

US stocks finished higher on Wednesday after Federal Reserve Chairman Jerome Powell hinted that an interest rate cut could come soon.

The Nasdaq Composite hit a new closing record, surpassing last week’s all-time high. The S&P 500 fell just a few points short of a fresh record.

  • The Dow closed 0.3%, or 77 points, higher.
  • The S&P finished 0.4% up.
  • The Nasdaq closed 0.8% higher at a new all-time high of 8,203 points.

All three benchmarks hit intraday highs on Wednesday.

Gains were mostly driven by energy, telecommunications and technology stocks.

US oil futures settled 4.5% higher at $60.43 a barrel, their highest level in seven weeks. Tropical Storm Barry poses a threat to crude production in the Gulf of Mexico. And crude oil inventories declined last week, according to newly released data. Both factors are driving the price of oil higher

1:29 p.m. ET, July 10, 2019

The dollar's status as the world's foremost reserve currency isn't under threat: Powell

The US dollar is the world's foremost reserve currency and that status is here to stay, at least for now, according to Federal Reserve Chairman Jerome Powell.

Asked about the greenback's status during his testimony before the Financial Services Committee, Powell said "it's hard to see the dollar not being the reserve currency for quite some time."

That said, it was certainly possible to move from one reserve currency to another, or from one to multiple, the central banker added. However, it's hard to see which other currency would be able to compete with the buck, at least in the near term, said Powell.

Part of the dollar's appeal as a reserve currency is the United States' fiscal stability, prosperity and rule of law. It's also an open trading nation, Powell said. In the long-run, the high US government debt balance could be a concern, he added.

1:07 p.m. ET, July 10, 2019

Alan Patricof: Trump's trade policy raises uncertainty

Alan Patricof, legendary venture capitalist and managing director at Greycroft, told CNN Business' Richard Quest on the "Markets Now" live show that President Donald Trump's trade policy has unsettled markets.

"It's about trade policy, but it's a broader thing: It's uncertainty," Patricof said. "Public markets don't like uncertainty. They don't like surprises."

Patricof said markets get a dose of uncertainty "every day, every hour," and the outcome is "we're living in a world that is being fractionated."

1:03 p.m. ET, July 10, 2019

Alan Patricof: Joe Biden is the logical choice to beat Donald Trump

Alan Patricof, legendary venture capitalist and managing director at Greycroft, told CNN Business' Richard Quest on the "Markets Now" live show that he hasn't yet chosen his favorite candidate for president, but he believes America should choose a candidate who can beat President Donald Trump.

Patricof has long supported Democrats, but he said he sees a lack of passion from the current slate of two dozen presidential candidates.

"If you're looking for me to say I'm looking for someone who is going to make us rich, that's not what I'm going to say," he said.

Biden is the "logical" choice to beat Trump, but he is "trying to stay on the sidelines." He said he has met six to 10 candidates.

12:58 p.m. ET, July 10, 2019

The crucial problem with Apple's strategy

Apple thinks that it can solve its iPhone sales problem by selling services, like Apple Care, Apple Music, apps and games.

But there's a problem with that strategy:

"Service revenue relies on hardware sales," noted Jun Zhang, analyst at Rosenblatt Securities, who recently downgraded Apple to a rare "sell" rating, told CNN Business' Richard Quest on the "Markets Now" live show.

Alan Patricof, legendary venture capitalist and managing director at Greycroft, disagrees.

"I take a much longer term view," he said. "Apple is a company that's here forever."

He noted that no one can replace Apple Founder Steve Jobs, but he said CEO Tim Cook maintains a vision for Apple (AAPL).

"The whole genius bar, the whole idea of service going into Apple and getting your phone taken care of, the whole thing ... I think it's a long-term company," he said. "If you have a long-term perspective, you want to invest in Apple."

12:53 p.m. ET, July 10, 2019

Fed Chair says economy could be in rough shape. This trader says yeah, but...

Federal Reserve Chairman Jerome Powell testified today that "crosscurrents" of trade and international economic struggles are blowing around the US economy. But some US traders are shrugging.

"Domestically, this economy is strong," Alan Valdes, partner at Wall Street Capital Partners, told CNN Business' Richard Quest on the "Markets Now" live show.

Walmart (WMT) is performing well, for example, despite tariffs. So that's good news for the US economy.

"I don't think people have seen an increase in prices at Walmart," he said.

12:51 p.m. ET, July 10, 2019

Going back to the gold standard would be a bad idea: Powell

It would be a bad idea for the United States to return to the gold standard, Federal Reserve Chairman Jerome Powell told the House Financial Services Committee.

Judy Shelton, who President Donald Trump nominated to the Fed last week, is favoring the United States to go back to the gold standard.

"I do not share those views," Powell said of Shelton's stance, but stressed he wouldn't comment on her nomination to the Fed.

For the United States to return to the gold standard, Congress would have to change the central bank's mandate. At present, that is achieving maximum employment and stable prices.

Changing the Fed's mandate to the price of gold per dollar is possible through monetary policy, but it would mean that other measures of the economy, like unemployment, would fluctuate, Powell said. That was why no country was using it anymore, he added.

12:04 p.m. ET, July 10, 2019

Powell lays out the factors that could lead to a rate cut

11:54 a.m. ET, July 10, 2019

Federal budget is on an 'unsustainable path,' says Powell

The Unites States federal budget is on an "unsustainable path," according to Federal Reserve Chairman Jerome Powell.

The government is spending faster than the economy is growing, so US debt as a percentage of GDP is at an unsustainable level, the central banker said during his hearing before the Financial Services Committee.

"We will wind up paying more interest" if the country continues on this path, Powell said, when that money could be spent on other things, such as educating the next generation.

At the end of the first quarter, government debt accounted for 104.6% of GDP, according to the St. Louis Fed.