Stocks Pause Early Gains Ahead Of FOMC Minutes

Stock indices are mixed after giving up their earlier gains. The Nasdaq 100 (NDX), S&P 500 (SPX), and Dow Jones Industrial Average are roughly flat as of 11:47 a.m. EST, Wednesday.

US Stock indices opened Wednesday’s trading with generally positive performance but close to the flatline in anticipation of the minutes from the Fed’s latest FOMC meeting. The Nasdaq 100 (NDX), S&P 500, and Dow Jones Industrial Average (DJIA) are up 0.3%, 0.15%, and 0.15%, respectively.


The Fed will release the minutes of the FOMC meeting today. Markets are baking in higher chances of further rate hikes in 2023 and expect inflation to remain at elevated levels. Treasury yields also rose to a record-high level yesterday, as fears of an inevitable recession creep in.

Equities are expected to remain under pressure for a prolonged period. A dull forecast from American big box retailers, Walmart and Home Depot also added to investor concerns.

A dimming outlook from Walmart, one of the largest groceries in the US, shows that consumers are being conservative now, more than ever, and inflation is pinching their pockets. Moreover, US Existing Home Sales numbers for the month of January came in lower than expected, marking the lowest reading since June 2020.

European indices also remained under pressure today following their US counterparts. A majority of the indices are trading in the red today on growing concerns about the future course of the Fed’s monetary policy.

The Asia-Pacific markets reacted negatively to the news of a 50 basis point rate hike by the Reserve Bank of New Zealand. The bank took the interest rate to a 14-year high figure of 4.75% to curb inflation.


Hong Kong’s Hang Seng, China’s Shanghai Composite, and Shenzhen Component indices closed down 0.51%, 0.47%, and 0.21%, respectively.


Similarly, Japan’s Nikkei and Topix ended the day down 1.34% and 1.11%, respectively. Japan’s producer price index rose 1.6% on an annualized basis, which aggravated investor concerns about the stubbornly high inflation.

Traders also await the second estimate for gross domestic product (GDP) figures of the fourth quarter, to be released on February 23, 2023.