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S&P 500, Dow tick higher ahead of Fed minutes

Economy20 minutes ago (Apr 07, 2021 10:50AM ET)

(C) Reuters. FILE PHOTO: The front facade of the NYSE is seen in New York

By Shivani Kumaresan and Medha Singh

(Reuters) – The S&P 500 and the Dow ticked higher on Wednesday, with financial stocks leading gains ahead of minutes from the Federal Reserve’s last meeting that could offer clues on the central bank’s views on inflation and an economic recovery. Inc (NASDAQ:AMZN), Microsoft Corp (NASDAQ:MSFT) and Facebook Inc (NASDAQ:FB) were among the top boosts to the benchmark S&P 500.

Massive fiscal stimulus and swift vaccinations prompted several Fed officials at the meeting last month to project interest rate increases as early as next year, opening up a gap with those who do not see rates rising until 2024 at the earliest.

“The only thing that could move markets would be a surprise in the minutes regarding the discussion of raising rates,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.

“At this point nobody is anticipating that.”

A strong monthly payrolls report, which helped the S&P 500 hit its fourth consecutive record high on Tuesday, is only a small step towards the central bank’s threshold for considering tapering its massive support for the economy.

Value stocks, which include economically sensitive sectors, maintain a strong lead this year over their growth counterparts, dominantly tech-related firms.

However, a resurgence in demand for tech stocks in recent sessions has raised questions over the longevity of value trade.

The value and growth indexes were at loggerheads by 09:48 a.m. ET.

The upcoming first-quarter earnings season and progress in a multi-trillion infrastructure proposal could decide the path forward for markets.

“The earnings season should be pretty good as we are seeing the economy reopen, jobs coming back … the expectation is increased guidance,” Nolte added.

At 09:49 a.m. ET the Dow Jones Industrial Average rose 53.73 points, or 0.16% , to 33,483.97, the S&P 500 gained 4.79 points, or 0.12 %, to 4,078.73 and the Nasdaq Composite lost 7.81 points, or 0.06 %, to 13,690.57.

Shares of energy firms gained 0.6% and cruise operators Norwegian Cruise Line (NYSE:NCLH), Carnival (NYSE:CUK) Corp and Royal Caribbean (NYSE:RCL) Cruises Ltd gained between 1.8% and 2.5% on optimism about an economic reopening.

Prison operator GEO Group fell about 19% after suspending quarterly dividend payments.

Shares of Ebon International rose 1.4% after the Chinese bitcoin mining machine maker responded to short-seller Hindenburg Research’s critical report.

Declining issues outnumbered advancers by a 1.1-to-1 ratio on the NYSE and by a 1.5-to-1 ratio on the Nasdaq.

The S&P 500 posted 21 new 52-week highs and no new lows, while the Nasdaq recorded 58 new highs and six new lows.

S&P 500, Dow tick higher ahead of Fed minutes

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