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Investors Eye Powell's Speech as U.S. Stock Indexes Gear Up for Lower Open

The U.S. stock market is preparing for a lower open on Tuesday, as investors wait for Federal Reserve Chair Jerome Powell's speech, which is expected to give further insight into the central bank's monetary policy.

The speech, which will be held at 12:40 p.m. EST, is being closely monitored after last week's strong jobs report raised questions about the future direction of the Fed.

According to Sam Stovall, Chief Investment Strategist at CFRA Research, "Markets are still trying to ascertain last Friday's employment data on the future direction of the Fed". Traders speculate that the Fed may raise the benchmark rate to 5.1% in June, a level that has been backed by officials. The anticipation of high interest rates for an extended period weighed down Wall Street's main indexes on Monday, however, all three major averages are still in the green for 2023 with the Nasdaq leading with a 13.6% increase.

Aside from Powell's speech, President Joe Biden is also set to deliver his first State of the Union address since the Republican party took control of the House of Representatives. Meanwhile, a number of companies are expected to make announcements throughout the day, including Microsoft's potential investment in ChatGPT and Baidu's conclusion of its ChatGPT-style project testing.

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