(Reuters) – Wall Street’s main markets were set to edge lower on Thursday as the previous session’s hints of a skeptical Federal Reserve attitude to a new cycle of interest rate cuts offset a handful of more bullish signs from U.S. retailers.

The minutes from the U.S. central bank’s meeting on July 30-31 showed policymakers deeply divided over their quarter-point cut in rates but united in wanting to signal the move was not on a preset path to further cuts.

While traders are sticking to bets that the Fed will cut again in September, money markets have now ruled out a half-point move, and Fed Chair Jerome Powell’s speech at an annual gathering in Jackson Hole on Friday may prove crucial to short-term sentiment.

While markets are on course to fall this month after a two-week sell-off driven by concerns over the U.S.-China trade war and its impact on global and U.S. growth, the signals for Powell from the economy this week have been more bullish.

Strong results for retailers Target (TGT.N), Lowe’s (LOW.N) and Nordstrom (JWN.N) on Wednesday were complemented by better than expected purchasing manager surveys in Europe on Thursday. U.S. surveys are due later, along with weekly jobless claims.

President Trump continues to press the Fed publicly to reduce rates, but many analysts say the U.S. economy is far further away from recession than some of its European rivals or than the bond market at times in recent months has suggested.

“Without sounding like a broken record, the danger is most definitely that Chairman Powell disappoints (on expectations he will signal more rate cuts),” said Jeffrey Halley, senior market analyst at online trading platform OANDA.

“It is hard to see Powell announcing or implying an aggressive new easing cycle in isolation when just a month ago, the FOMC was clearly very split as well.”

Among stocks, shares of Nordstrom Inc jumped 9.3% in premarket, as its results after the bell on Wednesday joined Target and Lowe’s in beating Wall Street profit estimates.

FILE PHOTO: A trader works on the floor at the New York Stock Exchange (NYSE) in New York, U.S., August 14, 2019. REUTERS/Eduardo Munoz

At 6:48 a.m. ET, Dow e-minis 1YMcv1 were down 36 points, or 0.14%. S&P 500 e-minis EScv1 were down 4.5 points, or 0.15% and Nasdaq 100 e-minis NQcv1 were down 21.5 points, or 0.28%.

Trade tensions, which stalled a rally in stocks at the start of this month, continued to simmer as China said on Thursday it hopes the United States will stop its wrong tariff action and that any new tariffs would lead to escalation.

The benchmark S&P 500 .SPX has fallen 3.4% from its record high hit in late-July.

Reporting by Akanksha Rana in Bengaluru

Our Standards:The Thomson Reuters Trust Principles.

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