(Bloomberg) — Bond yields climbed and stocks struggled for direction, with traders gearing up for Jerome Powell’s speech on Friday amid bets he’ll signal willingness to cut rates albeit at a moderate pace.

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That would throw a bit of cold water on market expectations for about 1 percentage point worth of easing by the end of this year. Treasury yields rose across the US curve, with the move led by shorter maturities — which are more sensitive to imminent policy moves. The dollar outperformed most major peers and the S&P 500 fluctuated — while remaining less than 1% away from its all-time high.

Wall Street traders waded through a raft of remarks from US policymakers, with Fed Bank of Kansas City President Jeffrey Schmid saying he wants to see more data before supporting cuts. His Boston counterpart Susan Collins says “a gradual, methodical pace” is likely to be appropriate. Her comments were echoed by Philadelphia Fed President Patrick Harker in a CNBC interview.

“The script is clear — the Fed is going to ease in September, but no one is portraying a desire to raise 50 basis points at this time,” said Andrew Brenner at NatAlliance Securities.

Traders are overplaying the prospects of an aggressive series of Fed cuts before the end of the year, according to Mohamed El-Erian.

“It is problematic in my mind that the market is pricing in so many rate cuts right now,” El-Erian, the president of Queens’ College, Cambridge, told Bloomberg Television on Thursday. “The market is overdoing it.”

Treasury 10-year yields advanced six basis points to 3.86%. In recent days, traders have cemented bets in the swaps market that Fed policymakers will ease policy by as much as one percentage point by year-end, starting in September with the likelihood of a 25- or even 50-basis-point cut.

The S&P 500 hovered near 5,620. Peloton Interactive Inc. rallied as a profit beat signaled the struggling fitness company’s turnaround efforts are starting to bear fruit. Snowflake Inc. plunged as a sales outlook failed to reassure investors that the company will gain ground in the market for artificial-intelligence software tools.

Chris Senyek at Wolfe Research says that the Fed Chair has historically used his remarks at the Jackson Hole symposium as a way to reset expectations surrounding upcoming Fed policy changes.

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“Our sense is Powell will maintain his dovish tone and signal a cutting cycle starting at the September meeting,” Senyek said. “However, contrary to what the futures market is pricing in for the remainder of 2024, we do not believe the Fed Chair will signal a cut larger than 25 basis points.”

Sam Stovall at CFRA also bets the next Fed-easing cycle will be initiated in a “more measured fashion” with a 25 basis point cut.

“This ‘slower to lower’ approach will likely be intended to signal that the Fed is not behind the curve, but will allow it to ensure that the embers of inflation have been fully extinguished before concluding that its mission has been completed,” he noted.

On the economic front, the latest figures were more of a mixed bag.

Data showed jobless claims data showed the labor market is cooling only gradually — rather than rapidly slowing. US manufacturing activity shrank at the fastest pace this year on further weakness in production, orders and factory employment. And existing-home sales increased for the first time in five months.

Corporate Highlights:

• Urban Outfitters Inc., the Anthropologie and Free People brands, posted quarterly sales growth that came in below Wall Street’s expectations.

• Carlyle Group Inc. is acquiring Advance Auto Parts Inc.’s Worldpac unit for $1.5 billion, striking the first major industrial investment for the firm in more than two years.

• Zoom Video Communications Inc. gave a sales forecast for the current quarter that beat analysts’ estimates, suggesting its expanded suite of products is making gains with business customers.

• Starboard Value LP urged Autodesk Inc.’s board to evaluate whether Chief Executive Officer Andrew Anagnost is the right person to lead the company following recent accounting issues.

• Toronto-Dominion Bank is setting aside $2.6 billion to cover fines it expects to pay for failures in its money-laundering controls, and the company sold part of its stake in Charles Schwab Corp. to fund it.

• Toronto-Dominion Bank posted its first quarterly loss in decades as the bank took a $2.6 billion provision for fines tied to US money-laundering investigations and saw results hurt by issues including extreme weather and wildfires.

Key events this week:

• Japan CPI, Friday

• BOJ’s Kazuo Ueda to attend special session at Japan’s parliament to discuss July hike, Friday

• US new home sales, Friday

• Jerome Powell speaks in Jackson Hole, Friday

Some of the main moves in markets:

Stocks

• The S&P 500 was little changed as of 10:48 a.m. New York time

• The Nasdaq 100 fell 0.1%

• The Dow Jones Industrial Average fell 0.2%

• The Stoxx Europe 600 rose 0.4%

• The MSCI World Index was little changed

Currencies

• The Bloomberg Dollar Spot Index rose 0.3%

• The euro fell 0.4% to $1.1109

• The British pound was little changed at $1.3102

• The Japanese yen fell 0.7% to 146.27 per dollar

Cryptocurrencies

• Bitcoin fell 1.2% to $60,489.16

• Ether fell 1.1% to $2,602.35

Bonds

• The yield on 10-year Treasuries advanced six basis points to 3.86%

• Germany’s 10-year yield advanced five basis points to 2.24%

• Britain’s 10-year yield advanced seven basis points to 3.96%

Commodities

• West Texas Intermediate crude rose 1.1% to $72.72 a barrel

• Spot gold fell 1.4% to $2,478.44 an ounce

This story was produced with the assistance of Bloomberg Automation.

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