FX.co ★ U.S. Stocks Climb Off Worst Levels But Remain In The Red After Fed Minutes

### Market Recap: Stocks Retreat Amid Fed's Cautionary Signals

Stocks traded without clear direction for much of Wednesday before succumbing to pressure from the Federal Reserve's latest monetary policy minutes. Major indices rebounded from their session lows by the close but still finished in negative territory, following Tuesday's modest gains.

- **Dow Jones:** Declined 201.95 points or 0.5% to 39,671.04

- **S&P 500:** Dropped 14.40 points or 0.3% to 5,307.01

- **Nasdaq:** Fell 31.08 points or 0.2% to 16,801.54

The market downturn was sparked by the Fed's minutes, which indicated that officials might maintain current interest rates longer than previously anticipated. The minutes from the April 30-May 1 meeting highlighted disappointing Q1 inflation data and robust economic indicators.

Officials noted it would take more time to feel confident that inflation is on a sustainable path toward the 2% target. As a result, they discussed the need to prolong the current restrictive policy stance unless there are unexpected declines in labor market conditions. Participants also showed readiness to hike rates further if inflation risks materialize.

_"The investing world will have to wait at least another month to hear anything about rate cuts. The surprise element in this report was some participants' willingness to further tighten policies,"_ commented Alex McGrath, Chief Investment Officer at NorthEnd Private Wealth.

Despite the bearish tone, traders appeared hesitant to make big moves ahead of Nvidia's (NVDA) quarterly earnings release. Analysts expect the AI giant to report significant growth in earnings and revenue.

### Sector Highlights

- **Gold Stocks:** Fell sharply, with the NYSE Arca Gold Bugs Index plummeting 3.7% amid a downturn in gold prices.

- **Oil Service Stocks:** Experienced a 3.4% dive in the Philadelphia Oil Service Index, driven by a slump in crude oil prices.

- **Housing Stocks:** Dropped following an unexpected decrease in existing home sales in August, with the Philadelphia Housing Sector Index down by 2.4%.

Other sectors, including brokerage, oil producers, and steel stocks, also saw notable declines, although biotechnology and semiconductor stocks resisted the downtrend.

### Global Markets and Bonds

- **Asia-Pacific:** Mostly lower, with Japan's Nikkei 225 Index down 0.9% and Hong Kong's Hang Seng Index edging lower by 0.1%.

- **Europe:** Major indices declined; German DAX Index fell 0.3%, French CAC 40 Index, and U.K.'s FTSE 100 Index both dropped 0.6%.

In the bond market, treasuries slipped slightly after the Fed's minutes release. Consequently, the yield on the benchmark ten-year note increased 2.0 basis points to 4.434%.

### Looking Ahead

Thursday's trading will likely be influenced by Nvidia's quarterly earnings report. Additionally, economic reports on weekly jobless claims and new home sales could garner attention.