US Markets
Equity Markets Rebound Following Fed Minutes; Yields Tumble
US stocks rebounded Wednesday as traders parsed minutes of the Federal Reserve's latest monetary policy meeting, while Treasury yields slid.The Nasdaq Composite rose 1.5% to 26,270.4, while the S&P 500 advanced 1.1% to 7,433, both rising after a three-day fall. The Dow Jones Industrial Average added 1.3% to 50,009.4. Most sectors ended in the green, led by consumer discretionary, while energy saw the biggest drop.Fed officials flagged the possibility of higher interest rates if the Middle East conflict drags on and keeps inflation above the 2% goal, minutes from the central bank's April meeting showed.Meeting participants generally determined that elevated inflation, combined with uncertainty around the duration and impact of the Iran war, could justify holding rates for longer than previously anticipated, the meeting minutes showed.However, majority of Fed officials pointed out "that some policy firming would likely become appropriate if inflation were to continue to run persistently above 2%.""The discussion at the April meeting suggests the (Federal Open Market Committee) is becoming increasingly worried about the inflation outlook," Sal Guatieri, senior economist at BMO Capital Markets, said in a report. "While it is in no rush to raise rates, that possibility will only grow if inflation remains stubbornly high."Treasury yields plunged in Wednesday late-afternoon trade, with the 10-year yield rate declining 9.6 basis points to 4.58% and the two-year rate retreating 7.4 basis points to 4.05%.Bond yields have surged amid mounting concerns about inflation. Higher yields drove a sell-off in stocks on Tuesday, according to Macquarie."The state of play now and following the end of earnings season, is that stock indexes are likely to remain sensitive to what happens to long-term yields," Macquarie said in note Wednesday. "Should yields go higher (for whatever reason), stocks will slip further."West Texas Intermediate crude oil was last down 5.5% at $98.47 a barrel, while Brent fell 5.6% to $105.03.US President Donald Trump said on Wednesday that negotiations with Iran had reached the final stages, though he warned of further attacks if Tehran backs out, according to a Reuters report.Shares of airlines and cruise operators were notable gainers on Wednesday, with United Airlines (UAL) up 10%, the top gainer on S&P 500. Delta Air Lines (DAL) jumped 9.4%, among the best performers on the index, along with Carnival (CCL) and Norwegian Cruise Line (NCLH).In other company news, Hasbro (HAS) reported a first-quarter operating loss for the consumer products division even as the toymaker delivered stronger-than-expected results at the consolidated level. The stock slid 8.8%, the worst performer on the S&P 500.Target (TGT) shares fell 3.9%, among the steepest declines on the S&P 500. The retailer lifted its full-year sales growth outlook as it recorded higher-than-expected fiscal first-quarter results.TJX (TJX) raised its full-year outlook after posting stronger-than-expected fiscal first-quarter results, with comparable sales rising across all segments. The stock climbed 5.6%.Gold was last up 0.8% at $4,549.30 per troy ounce, while silver rose 1.8% to $76.48 per ounce.
Dow JonesNasdaq CompositeS&P 500$CCL$DAL$HAS$NCLH$NVDA$TGT$TJX$UAL
