U.S. stocks rose Wednesday, as meeting minutes from the Federal Reserve showed that the central bank is looking to hand out smaller rate hikes in the coming months as inflation cools off.
The Dow Jones Industrial Average rose 130 points or 0.38%. The S&P 500 gained 0.70% and the Nasdaq Composite increased 1.10%.
Shares of Nordstrom fell more than 3% after the department store chain reaffirmed its forecast. However, Nordstrom beat profit and sales expectations in its latest results, according to consensus expectations on Refinitiv. Tesla rose more than 5% after Citi upgraded shares to neutral from sell. Deere surged nearly 7% on an earnings beat.
Jobless claims data came in higher than expected at 240,000 for the week ending Nov. 19 where economist expected 225,000, signaling that the labor market may be weakening. At the same time, however, durable goods orders for October were stronger than anticipated, coming in at 1%, more than the 0.5% expected.
“In the market’s interpretation this is positive given that the Fed wants to see a rebalancing in the labor market whereby businesses begin to hold leverage over the demand for higher wages,” said Quincy Krosby, chief global strategist for LPL Financial. “Higher wages have been consistently passed along as higher prices leading to rising inflationary pressures.”
Investors are awaiting the latest Fed meeting minutes, due Wednesday afternoon, for insight into the central bank’s approach on monetary policy ahead of the December meeting.
Earlier in November, the central bank approved a fourth consecutive 0.75 percentage point hike that brought rates to their highest level since 2008. Economists are forecasting a half percentage point increase in December, and smaller rate hikes next year.
Wall Street is coming off an upbeat session, with the Dow Jones Industrial Average surging nearly 400 points Tuesday as traders shrugged off fears of further lockdowns in China and looked to strong earnings. The S&P 500 rose 1.36%, closing above the 4,000 level for the first time since September. Meanwhile, the Nasdaq Composite jumped 1.36%.
Markets will be closed on Thursday for the Thanksgiving holiday and will close early on Friday.
Source: CNBC
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