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US stocks closed lower on Wednesday as traders and investors are busy digesting the summary of the Fed’s latest meeting minutes, looking for clues on the central bank’s next move against inflation.
The Dow Jones Industrial Average dropped 84.50 points, or 0.26%, ending at 33,045.09. The S&P 500 fell 0.16% and closed at 3,991.05. Meanwhile, the Nasdaq Composite rose 0.13% to close at 11,507.07. FOMC minutes showed inflation remained “well above” the Fed’s 2% target, adding that the labor market is still “very tight, contributing to continuing upward pressures on wages and prices.”
Fed officials also noted that “inflation data received over the past three months showed a welcome reduction in the monthly pace of price increases but stressed that substantially more evidence of progress across a broader range of prices would be required to be confident that inflation was on a sustained downward path,” the minutes said.
The minutes were released after St. Louis Fed President James Bullard cautioned earlier Wednesday that the central bank’s fight against inflation is far from over. Mounting concerns that the Fed will continue hiking rates spooked investors Tuesday and pushed stocks to their worst day of 2023.
The minutes did not change the market’s trajectory, as investors remain steadfast in their belief that the Fed will not continue much further with its rate hikes. This is not a market that thinks that the Fed is going to have to continue beyond June with rate hikes, it is rather a market that has been concerned about earnings about margins, margins pressure, and margin compression. Shares of Palo Alto Networks popped 12.5% after the cybersecurity company lifted its earnings forecast for the year. Crypto exchange platform Coinbase topped revenue expectations, but shares fell 1.4%.
