Feb 22 (Reuters) – Wall Street’s major indexes edged higher in choppy trading on Wednesday, a day after their worst performance of the year, as investors awaited Federal Reserve policy meeting minutes for further news. indices on the path of interest rates.
U.S. stocks fell more than 2% on Tuesday after a rebound in business activity in February fueled fears that interest rates will stay higher for longer.
January-February 31 minutes from the Fed. 1 meeting, scheduled for 2:00 p.m. ET, is expected to detail the extent of the debate at the central bank over the trajectory of the rate hike.
“Few members of the Fed have spoken publicly about the desirability of a 50 basis point hike and investors would want to gauge how serious this discussion is within the central bank,” said Matt Stucky, portfolio manager. main portfolio at Northwestern Mutual Wealth Management Co.
St. Louis Fed President James Bullard, who argued for a half-point hike in the Fed’s last session, said the US central bank needed to bring inflation back towards its target of 2% this year to avoid its prolonged impact.
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New York Fed President John Williams, a voting member of the rate-setting committee this year, is scheduled to speak later today.
After a market rout in 2022, all three major indexes posted monthly gains in January as investors hoped the Fed would suspend rate hikes and perhaps pivot towards the end of the year.
However, stocks had a volatile run in February, leaving the Dow flat for the year as traders priced in higher interest rates for longer, assuming inflation remains higher in a robust economy.
Money market participants expect rates to peak at 5.35% by July and stay around those levels until the end of 2023.
As of 12:29 a.m. ET, the Dow Jones Industrial Average (.DJI) was up 87.29 points, or 0.26%, at 33,216.88, the S&P 500 (.SPX) was up 8.86 points, or 0.22%, to 4,006.20, and the Nasdaq Composite (.IXIC) rose 31.84 points, or 0.28%, to 11,524.14.
Nine of the 11 major S&P 500 sectors advanced, with consumer discretionary stocks (.SPLRCD) climbing 0.9%.
Analysts polled by Reuters expect the S&P 500 index to rise 5% by the end of the year, but high interest rates and inflation have led many strategists to predict a correction in the next three months.
Growth names like Tesla Inc (TSLA.O), Nvidia Corp (NVDA.O), Qualcomm Inc (QCOM.O) and Amazon.com Inc (AMZN.O) edged higher as US Treasuries yield at 10 years has slipped from multi-month highs.
Palo Alto Networks Inc (PANW.O) rose 11.6% after the cybersecurity company raised its full-year profit forecast.
CoStar Group (CSGP.O) fell 4.0% as the online real estate market provider said it was no longer in talks to buy Move Inc, owner of Realtor.com, from News Corp (NWSA. O) and forecast disappointing first-quarter revenue.
Advancing issues outnumbered declining issues with a 1.69-to-1 ratio on the NYSE. Advancing issues outnumbered declining issues with a 1.27-to-1 ratio on the Nasdaq.
The S&P index recorded three new 52-week highs and one new low, while the Nasdaq recorded 21 new highs and 92 new lows.
Reporting by Johann M Cherian and Medha Singh; Editing by Arun Koyyur and Anil D’Silva
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