Stocks rose for a second straight session on Wednesday as investor concerns over increasing geopolitical tensions eased and traders turned their attention towards key economic data and the start of the third-quarter earnings season later this week. The Dow Jones Industrial Average climbed over 400 points, while the S&P 500 Index and Nasdaq Composite advanced 0.7% and 0.6%, respectively.
Here's how the market settled on Wednesday:
S&P 500 Index (NYSE: SPY): +0.71% or +40.91 points to 5,792.04
Dow Jones Industrial Average (NYSE: DIA): +1.03% or +431.63 points to 42,512.00
Nasdaq Composite Index (NASDAQ: QQQ): +0.60% or +108.70 points to 18,291.62
FOMC Minutes:
Federal Reserve officials were divided on how aggressive their interest rate cutting campaign should be at their September meeting, where the majority of members voted to reduce the funds rate by 50 basis points, the central bank's meeting minutes showed.
"Some participants observed that they would have preferred a 25 basis point reduction of the target range at this meeting, and a few others indicated that they could have supported such a decision," the minutes stated.
"Several participants noted that a 25 basis point reduction would be in line with a gradual path of policy normalization that would allow policymakers time to assess the degree of policy restrictiveness as the economy evolved," the minuted added. "A few participants also added that a 25 basis point move could signal a more predictable path of policy normalization."
FedWatch:
Dallas Federal Reserve President Lorie Logan said in a speech Wednesday in Houston that she believes the central bank should cut interest rates gradually as she is concerned inflation could remain about the Fed's 2% goal if policymakers move too quickly. Logan will not be a FOMC voter until 2026.
Logan said that a "more gradual path back to a normal policy stance will likely be appropriate from here to best balance the risks to our dual-mandate goals," with the risks including high level of demand and easing financial conditions (like lower mortgage rates) could halt progress on easing inflation.
Federal Reserve Vice Chair Philip Jefferson said in prepared remarks at Davidson College in North Carolina late Tuesday that policymakers lowered interest rates in effort to support the labor market in September.
"The [Federal Open Market Committee] has gained greater confidence that inflation is moving sustainably toward our 2 percent goal," he said. "To maintain the strength of the labor market, my FOMC colleagues and I recalibrated our policy stance last month, lowering our policy interest rate by 1/2 percentage point."
Jefferson added that the Fed will "carefully watch incoming data, the evolving outlook, and the balance of risks when considering additional adjustments to the federal funds target range."
In the News:
Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) shares fell on Wednesday on reports that the U.S. Department of Justice is weighing a potential breakup of Google following an antitrust ruling.
The department said in a filing that changes necessary to "prevent and restrain monopoly maintenance could include contract requirements and prohibitions; non-discrimination product requirements; data and interoperability requirements; and structural requirements."
For Thursday:
Market participants will react to September's consumer price index (CPI) reading as well as another series of Fedspeak on Thursday. Key earnings reports also include Delta Air Lines (NYSE: DAL) and Domino's Pizza (NYSE: DPZ).