After having a quiet start to the day, major equity indexes in the U.S. recorded modest gains on Wednesday to close at fresh record highs.
Earlier in the day, the US Treasury-bond yields came under pressure, weighing on the S&P 500 Financial Index (SPSY). However, after the FOMC released its September meeting minutes, financials were able to retrace their losses as market's expectation of a December rate hike didn't change much. According to the CME Group FedWatch Tool, the probability of a 25 bps rate hike before the end of the year is at 86.7%.
Commenting on the market's price action and the FOMC minutes, "you've got sector rotation grinding the indexes higher and it's hard to see what stops that. Nothing changes the opinion that the Fed is likely to hike rates after the December meeting," Art Hogan, chief market strategist at Wunderlich Securities in New York, told Reuters.
On the other hand, crude oil prices extended their rebound with the barrel of West Texas Intermediate settling above the $51 handle and lifting the S&P 500 Energy Index (SPNY) to its highest level since April at 510.24. In the meantime, fueled by robust gains in Wal-Mart and Kroger retailers outperformed other sectors for the second day in a row with the S&P 500 Consumer Staples Index (SPLRCS) ending the day 0.25% higher.
The Dow Jones Industrial Average added 38.97 points, or 0.17%, to 22,869.65, the S&P 500 rose 4.3 points, or 0.17%, to 2,554.94 and the Nasdaq Composite gained 15.95 points, or 0.24%, to 6,603.21.
Headlines from the NA session:
- EUR/USD rises to fresh 2-week highs above mid-18s after Fed's Williams' comments
- Fed's Williams: Losing confidence we will see tax reform in next 6 months
- CME Group FedWatch's December hike probability eased below 90% post-FOMC minutes
- DXY falls to test daily lows after FOMC minutes
- FOMC Minutes: Many Fed officials saw another rate hike warranted this year
- NY Fed's Potter: FOMC to reduce size of portfolio in a gradual manner
- N.Korea ForMin: Will make US pay with ‘hail of fire’ - TASS
- US: Job openings little changed in August - Wells Fargo
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