4:08pm: Lack of surprise out of Fed meeting encourages traders
The Dow closed a bumpy Wednesday up 193 points, 0.6%, at 32,122. The Nasdaq added 170 points, 1.5%, to reach 11,435, while the S&P 500 increased 38 points, 1%, to 3,979.
Traders reacted to minutes from the Fed’s latest meeting that reiterated the central bank’s commitment to lowering inflation to its 2% objective through interest rate hikes.
“There weren’t any surprises which is why we probably bounced, and even after it hit, we’ve been all over the place,” Bleakley Advisory Group CIO Peter Boockvar said, as CNBC reported. “There’s nothing new in it, but the markets didn’t want to hear anything more hawkish than the hawkishness they already laid out.”
In meme stock news, GameStop Corp (NYSE:GME) shares popped nearly 30% to $115.17.
2:15pm: Stocks remain in positive territory following release of Fed meeting minutes
US stocks remained in the green on Wednesday afternoon as minutes from the Fed’s latest meeting have reiterated the central bank’s commitment to lowering inflation to its 2% objective through interest rate hikes.
Released at 2pm ET, the minutes reaffirmed that the Fed's position is that it would be appropriate to rise interest rates by 50 basis points over the next couple of meetings.
Shortly after the release of the minutes, the Dow was steady at 31,965 points.
The S&P 500 was up 22 points at 3,963 points and the Nasdaq had gained 119 points at 11,383 points.
12:05pm: US stocks in positive territory
US stocks had edged into the green at midday after a cautious start to the day's trading as investors look ahead to the release of the minutes from the Fed’s latest meeting.
At noon, the tech-laded Nasdaq was leading the markets into positive territory, up 88 points at 11,352 points.
The Dow was up 50 points at 31,978 and the S&P 500 was up 16 points at 3,958 points.
Noting that markets were a little flat ahead of the release of the Fed’s meeting minutes, OANDA senior market analyst Craig Erlam said he was unsure what exactly investors were holding out for.
“A lot has changed in the markets over the last few weeks and we've had a lot of Fed commentary in that time that is arguably more relevant than almost anything we can take from the minutes,” Erlam said.
“That said, this is nothing new and investors are always wary of what could happen. Especially when market conditions are as volatile and uncertain as they are. There is no shortage of anxiety in the markets and the minutes could potentially feed into that.”
Erlam said that interest rate expectations have pared back a little in recent weeks as economic fears have become more prominent.
“The central bank still expects to avoid a recession, which may be referenced in the minutes, but investors are becoming less confident as the cost of living squeezes household budgets,” he said.
CMC Markets UK chief market analyst Michael Hewson noted that retail weaknesses have continued this week, with Dick’s Sporting Goods Inc downgrading its full year outlook despite beating revenues and profits for 1Q.
“For 2023 sales outlook was revised down to -2% to -8%, while profits were seen down to $9.15 to $11.70 from $11.70 to $13.10 a share,” he said.
However, the company’s share price was unaffected by its revised outlook, having surged about 11% at noon.
Nordstrom Inc’s shares had also surged about 13% after the company reported a 19% increase in its sales to $3.47 billion in its latest quarterly earnings report.
“Nordstrom has bucked the outlook for weak retail raising its annual forecasts after beating expectations of Q1 revenues,” Hewson said.
Meanwhile, US durable goods orders rose 0.4% in April, below the consensus analyst expectation of 0.6%, with orders ex-transportation rising 0.3%, also below the consensus of 0.5%.
Pantheon Macroeconomics chief economist Ian Shepherdson said the key question of whether orders growth would continue to slow was unanswerable for now.
“The numbers are noisy, and the pattern in recent months, with hefty monthly gains followed by weaker readings, makes it hard to see the trend over short periods,” he said.
“It’s entirely possible that the recent slowing is nothing more than a temporary reaction to the spike in energy prices; firms might be waiting to see how consumers respond.”
10.05am: Proactive North America headlines:
Nextleaf adds to its cannabinoid processing IP portfolio with new Jamaican patent for its foundational extraction method
Perk Labs inks franchise agreement as it expands into Toronto area
Endeavour Mining publishes 2021 sustainability report
Arizona Silver says drilling at Philadelphia project extends high-grade zone
Fabled Copper reports significant mineralization at BC Davis Keays Eagle Vein
Sonoro Gold continues to report high-grade gold intercepts from outside current resource area at Cerro Caliche
Northstar Gold kicks off borehole geophysics program on its Miller Gold property in Ontario
Pathfinder Ventures (TSX-V:RV) kicks off summer camping season with 100% occupancy at its RV camp resorts over the Victoria Day long weekend
Dalrada reports 252% increase in revenue in its fiscal third quarter
Gratomic continues drilling at Capim Grosso project in Brazil with good graphite results
NioCorp names mining and critical process industry veteran Peter Oliver to its board of directors
Aben Resources (TSX-V:ABN, OTCQB:ABNAF) eyes growing demand for graphite as it also goes for gold
Tartisan Nickel kicks off construction on all-season access road for its flagship Kenbridge Nickel project in Ontario
LexaGene reveals MiQLab Systems sale to large US veterinary corporation
Jushi Holdings confident of ‘accelerated growth and profitability’ after retail expansion boosts year-on-year revenue growth in Q1
GlobalBlock says transition of digital asset brokerage business to EU is complete
The Valens Company (TSX:VLNS, OTCQX:VLNCF) continues to gain recreational market share in the six months to April 2022
Psyched Wellness (CSE:PSYC, OTCQB:PSYCF) says it received C$226,500 from sale of non-core assets
ANGLE scores a world-first with FDA sign-off for liquid biopsy system; shares rocket 34%
Snowline Gold stakes more ground at emerging gold district in the Yukon
Copper Fox announces results of airborne survey of Mineral Mountain copper project
Goldshore Resources announces public and educational tri-party institutional partnership with Alliance grant
Aben Resources (TSX-V:ABN, OTCQB:ABNAF) eyes growing demand for graphite as it also goes for gold
EverGen Infrastructure announces 1Q revenue of C$1.4M boosted by flood insurance proceeds
Vox Royalty (TSX-V:VOX) reports record revenues and gross profit in 1Q ended March 31, 2022
9:35am: US stocks mixed at the open
US stocks opened mixed on Wednesday as investors await the release of minutes from the Fed’s latest meeting which are expected to provide insights into the financial body’s monetary policy pathway over the coming months.
Just after the open, the Dow had shed 75 points at 31,854 points.
The S&P 500 and the Nasdaq were both steady at 3,941 points and 11,263 points respectively.
After plunging 43% yesterday, Snapchat’s parent body Snap Inc (NYSE:SNAP) had recovered some of its losses, up about 5% just after the open.
6.30am: Traders hesitant to take positions
US markets are expected to open mixed ahead of the release of the minutes from the US Federal Open Market Committee’s most recent meeting, which will provide more context to the Fed’s decision to hike interest rates by 50 basis points, the biggest increase in 22 years.
Futures for the Dow Jones Industrial Average declined 0.03% in Wednesday pre-market trading, while those for the broader S&P 500 index gained 0.06% and the Nasdaq added 0.14%.
Naeem Aslam, chief market analyst at avatrade.com, said traders are hesitant to place any significant bids ahead of the FOMC minutes.
“Traders know that central banks around the globe are playing a catch-up game with inflation, and they are trying their best to front-load as much as they can to bring inflation lower while keeping close tabs on economic numbers,” Aslam commented. “There is fear among investors and traders that policymakers may make another significant mistake if they continue to adopt a steep tightening phase as stagflation is sitting on the doorstep.”
US markets also ended mixed on Tuesday after spending the vast majority of the day underwater. The Dow turned around to closed 0.15% higher at 31,929. The Nasdaq, meanwhile, tumbled 2.35%, to 11,264 and the S&P 500 32 dropped 0.81% to 3,941.
Snap Inc (NYSE:SNAP), the parent company of social media platform Snapchat, plunged 43% after it slashed its forecast amid rising inflation and interest rates, and supply chain and labor challenges.
After last week’s disappointing retail earnings, Snap’s profit warning has reiterated the impact of inflationary pressures on corporate bottom lines, sparking concern among investors.
“Nasdaq is the stock index which continues to remain under significant selling pressure as the outlook from tech companies continues to push the index price lower,” Aslam continued. “For instance, investors are losing faith in social media companies and their advertisement revenue after the drama about Snap's earnings results. All major platforms, Meta, Snap and Twitter, have their own challenging situations, and it doesn't seem like their pain will go away anytime soon.”