NEW YORK, May 25 (Reuters) – Wall Street closed higher on Wednesday following the release of the minutes of the last Federal Reserve monetary policy meeting, which showed that political leaders unanimously The US economy was very strong as they struggled to curb inflation without causing a recession. .
The minutes of the May meeting of the Federal Open Market Committee, which culminated in a 50-point rise in the target rate of Fed funds, the biggest jump in 22 years, showed that most members of the committee considered that new rate hikes would “probably” occur. be appropriate “at their next meetings in June and July. Read more
“Uniformity of opinion is a good thing,” said Ross Mayfield, Baird’s investment strategy analyst in Louisville, Kentucky. “There is a lack of uncertainty about what needs to be done in the short term.”
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“When (the Fed) arrives in September, they will have a lot of economic data to make their way from here, so they continue to maintain the optionality,” Mayfield added.
The top three U.S. stock indexes revolved earlier in the day amid growing concerns about business and consumer surveys, economic data and earnings reports suggesting a cooling of the U.S. economy, including as the Fed prepares to throw a bucket of cold water at it for decades. – high inflation.
Fears that overly aggressive interest rate hikes by the Fed could plunge the economy into recession despite evidence that inflation peaked in March have fueled these concerns.
“There is some credibility to the idea that inflation is doing the job (for the Fed) for them,” Mayfield said. “A cooling is already taking place and financial conditions have hardened over the last month due to the strength of the dollar and the weakness of the stock market.”
A person goes through the New York Stock Exchange (NYSE) in Manhattan, New York, USA, May 19, 2022. REUTERS / Andrew Kelly
On Thursday, the Commerce Department is due to release its second first-quarter GDP view, which analysts expect to curb a contraction slightly lower than the originally reported 1.4% annualized drop.
The personal consumption expenditure (PCE) report will follow on Friday, providing more clues as to consumer spending and whether inflation peaked in March, as other indicators have suggested.
According to preliminary data, the S&P 500 (.SPX) gained 38.55 points, or 0.94%, to finish at 3,980.03 points, while the Nasdaq Composite (.IXIC) gained 166.41 points, or a 1.48%, to 11,430.86. The Dow Jones Industrial Average (.DJI) rose 192.51 points, 0.60%, to 32,119.74.
Electric car maker Tesla Inc. (TSLA.O) and retail power Amazon.com (AMZN.O) provided the strongest rise to the S&P 500 and Nasdaq.
Chip maker Nvidia Corp. (NVDA.O) advanced ahead of its first-quarter results that came after the bell.
Department store operator Nordstrom Inc (JWN.N) rose after optimistic earnings and annual revenue forecasts. Read more
Wendy’s Fast Food Chain (WEN.O) jumped after a regulatory filing revealed that shareholder Nelson Peltz was considering a possible takeover bid for the company. Read more
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Report by Stephen Culp; additional reports by Anisha Sircar and Devik Jain in Bangalore; edited by Jonathan Oatis
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