US close: Stocks rise as investors sift through Fed minutes

Wall Street finished above the waterline on Wednesday, as market participants digested a set of Federal Reserve meeting minutes that put the prospect of interest rate cuts well and truly beyond the horizon.

At the close, the Dow Jones Industrial Average was up 0.4% at 33,269.77, as the S&P 500 added 0.75% to 3,852.97 and the Nasdaq Composite was ahead 0.69% at 10,458.76.

The Dow closed 133.4 points higher on Wednesday, easily reversing the modest losses it recorded on Tuesday when major indices struggled for direction on the first trading day of the new year.

“One session is a blip, but two might be a trend - at least, that is what many investors will be hoping about the relationship between US and European stocks,” said IG chief market analyst Chris Beauchamp earlier.

“After years in which it was folly to do anything but buy American stocks, there are signs perhaps that non-US equities are coming into their own once again.

“While US stocks will have been kept in check today because of Fed minutes and then the run of job data, it still looks like investors are much keener on putting their money to work this side of the Atlantic.”

Wednesday’s focus was the release of minutes from the Federal Open Market Committee’s most recent meeting late in the session, which showed none of its members were expecting a rate cut to be appropriate in 2023.

The minutes from the FOMC’s December meeting, at which rate setters decelerated to a 50-basis point increase in the federal fund rate target, showed the FOMC wanting more evidence of slowing inflation after some recent hopeful data.

Members said easing too early could “complicate” efforts to restore price stability.

The minutes showed 17 of the FOMC’s 19 officials seeing interest rates rising above 5% this year, with a possible terminal peak of 5.25% pencilled in by most members.

Positive inflation data out of Europe boosted sentiment earlier in the day, including a better-than-expected fall in France's consumer price index and a decline in import prices in Germany.

Elsewhere on the economic front, US mortgage applications fell 10.3% to a 27-year low in the week ended 30 December, according to the Mortgage Bankers Association of America, driven by a 12% crash in the purchase index and a 4.4% drop in refinancing applications.

A key gauge of labour market tightness meanwhile was little changed towards the end of 2022, contrary to expectations, according to a closely-followed survey.

The US Department of Labor reported that in seasonally-adjusted terms, the number of job openings dipped to 10.458 million in November from 10.512 million in October.

That was better than the drop to 9.9 million anticipated by economists.

Staying stateside, activity in the US manufacturing sector cooled a bit more but roughly as expected during the last month of 2022 according to another survey.

The Institute for Supply Management's factory sector PMI dipped to 48.4 in December from 49.0 for the month before, just shy of expectations for a print of 48.5.

Comments from purchasing managers focused on weaker demand, staffing shortages and improved supply chain conditions.

In equities, cryptocurrency exchange operator Coinbase Global rocketed 12.2% after it reached a settlement with New York state regulators.

Coinbase agreed to pay $50m in penalties over previous compliance allegations, and pledged to invest another $50m in ongoing compliance.

Elsewhere, Salesforce gained 3.57% after announcing a restructuring that would see 10% of its workforce laid off and some offices closed, while GE HealthCare Technologies jumped 8.02% on its first day of trading after spinning out from General Electric.

GE itself ended the session 5.86% firmer.

Reporting by Josh White for Sharecast.com. Additional reporting by Iain Gilbert.

Dow Jones - Risers

Boeing Co. (BA) $203.64 4.22%
Salesforce.Com Inc. (CRM) $139.59 3.57%
Intel Corp. (INTC) $27.68 3.55%
Walt Disney Co. (DIS) $91.98 3.38%
Dow Chemical Co. (DOW) $52.33 2.53%
Verizon Communications Inc. (VZ) $41.13 2.52%
Visa Inc. (V) $212.64 2.52%
American Express Co. (AXP) $150.54 2.32%
3M Co. (MMM) $125.15 2.19%
Nike Inc. (NKE) $121.19 2.07%

Dow Jones - Fallers

Microsoft Corp. (MSFT) $229.10 -4.37%
Unitedhealth Group Inc. (UNH) $504.50 -2.73%
Chevron Corp. (CVX) $172.14 -1.06%
Cisco Systems Inc. (CSCO) $47.55 -0.81%
Coca-Cola Co. (KO) $62.92 -0.05%
Honeywell International Inc. (HON) $0.00 0.00%
Dowdupont Inc. (DWDP) $0.00 0.00%
McDonald's Corp. (MCD) $264.39 0.02%
Travelers Company Inc. (TRV) $187.23 0.06%
Walmart Inc. (WMT) $143.80 0.11%

S&P 500 - Risers

Jefferies Financial Group Inc. (JEF) $38.68 13.03%
Bath & Body Works, Inc. (BBWI) $47.73 10.51%
Carnival Corp. (CCL) $8.74 9.66%
Royal Caribbean Cr (RCL) $52.68 8.07%
Micron Technology Inc. (MU) $54.20 7.60%
Carmax Inc. (KMX) $65.12 7.39%
Nektar Therapeutics (NKTR) $2.34 6.85%
Hanesbrands Inc. (HBI) $7.19 6.84%
MGM Resorts International (MGM) $35.53 6.79%
United Airlines Holdings Inc (UAL) $39.72 6.75%

S&P 500 - Fallers

General Electric Co. (GE) $70.20 -17.39%
Arista Networks Inc. (ANET) $113.84 -5.85%
Microsoft Corp. (MSFT) $229.10 -4.37%
Archer-Daniels-Midland Co. (ADM) $86.30 -3.64%
CIGNA Corp. (CI) $310.30 -3.48%
Apache Corp. (APA) $42.15 -3.37%
Elevance Health Inc. (ELV) $485.44 -3.34%
AES Corp. (AES) $27.25 -2.95%
Unitedhealth Group Inc. (UNH) $504.50 -2.73%
Northrop Grumman Corp. (NOC) $526.52 -2.57%

Nasdaq 100 - Risers

JD.com, Inc. (JD) $66.10 14.68%
Baidu Inc. (BIDU) $131.76 10.60%
Qurate Retail Inc. (QRTEA) $1.77 9.94%
NetEase Inc. Ads (NTES) $82.57 8.01%
Micron Technology Inc. (MU) $54.20 7.60%
Trip.com Group Limited (TCOM) $38.13 6.84%
American Airlines Group (AAL) $13.59 6.67%
Biomarin Pharmaceutical Inc. (BMRN) $106.92 6.27%
Wynn Resorts Ltd. (WYNN) $90.90 6.18%
Align Technology Inc. (ALGN) $224.63 5.82%

Nasdaq 100 - Fallers

Microsoft Corp. (MSFT) $229.10 -4.37%
O'Reilly Automotive Inc. (ORLY) $826.74 -1.66%
Alphabet Inc. Class A (GOOGL) $88.08 -1.17%
Cintas Corp. (CTAS) $443.83 -1.15%
Alphabet Inc. Class C (GOOG) $88.71 -1.10%
Cisco Systems Inc. (CSCO) $47.55 -0.81%
Amazon.Com Inc. (AMZN) $85.14 -0.79%
Biogen Inc (BIIB) $270.81 -0.67%
Incyte Corp. (INCY) $79.08 -0.59%
Cadence Design Systems Inc. (CDNS) $159.23 -0.26%