Volkswacht Bodensee - Stocks waver before Fed testimony on US economy

Fed Chair Jerome Powell on Tuesday begins two days of testimony before the US Congress, where he will be pressed about the central bank's efforts to cool high inflation.

Investors are looking for a clearer idea on when the Fed may pause its rate-tightening cycle, which aims to cut soaring prices but could also tip the economy into recession.

"Nothing matters more to the stock market these days than the direction of interest rates," said Briefing.com analyst Patrick O'Hare.

Wall Street opened mixed, with the tech-heavy Nasdaq rising, the Dow Jones Industrial Average fell and S&P 500 was flat.

In Europe, London's FTSE 100 rose while the Paris CAC 40 was flat and the Frankfurt DAX retreated despite official data showing industrial orders in Germany climbed for a second straight month in January.

The Fed raised rates by 25 basis point last month after a half-point increase in December that followed a series of three-quarter hikes.

"At present, the market is pricing in three more rate rises this year, including a 0.25-percent hike later this month, but any increase in hawkish rhetoric would likely spell danger for equity markets," said Richard Hunter, head of markets at Interactive Investor.

While analysts are betting on the United States and other major economies possibly avoiding recession despite inflation remaining elevated, there are concerns over China after the world's second-biggest economy set a lower-than-expected target for its growth this year.

Following Powell's testimony, attention will switch to US jobs data for February that is due Friday.

That comes after January's reading showed more than half a million new jobs were created, far more than expected.

"The key focus will be on how Powell sees the US labour market, and whether the... (policy board) think that economic conditions have improved or deteriorated since the last Fed meeting," said Michael Hewson at CMC Markets.

"If he acknowledges that inflation could be much stickier than the Fed thought over a month ago, that could prompt a pullback in US equity markets."

In Asia, Hong Kong and Shanghai ended down as data showed Chinese imports and exports fell in January and February.

- Key figures around 1440 GMT -

New York - Dow: DOWN 0.1 percent at 33.404,04 points

London - FTSE 100: UP 0.1 percent at 7,938.58

Frankfurt - DAX: DOWN 0.2 percent at 15,626.48

Paris - CAC 40: FLAT at 7,375.60

EURO STOXX 50: DOWN 0.3 percent at 4,303.14

Tokyo - Nikkei 225: UP 0.3 percent at 28,309.16 (close)

Hong Kong - Hang Seng Index: DOWN 0.3 percent at 20,534.48 (close)

Shanghai - Composite: DOWN 1.1 percent at 3,285.10 (close)

Euro/dollar: DOWN at $1.0646 from $1.0684 on Monday

Pound/dollar: DOWN at $1.1976 from $1.2023

Euro/pound: UP at 88.89 pence from 88.84 pence

Dollar/yen: UP at 136.32 yen from 135.95 yen

West Texas Intermediate: DOWN 0.4 percent at $80.14 per barrel

Brent North Sea crude: DOWN 0.4 percent at $85.84 per barrel

H.Seidel--BTB