©Reuters. Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 22, 2022. REUTERS/Brendan McDermid
By Carolina Mandl and Sinead Carew
(Reuters) – Wall Street’s major indices closed with solid gains on Wednesday after the minutes of the Federal Reserve’s meeting in November indicated rate hikes could soon slow.
A “significant majority” of policymakers agreed that it would be “probably soon appropriate” to slow the pace of rate hikes, the minutes showed.
“What the stock markets needed to sustain the recent strength was what we got out of the minutes,” said Michael James, director of equity trading at Wedbush Securities in Los Angeles.
Since the Fed’s last meeting on November 1-2, investors are more optimistic that price pressures are beginning to ease, meaning smaller rate hikes could limit inflation.
The rose 95.96 points, or 0.28%, to 34,194.06, the won 23.68 points, or 0.59%, at 4,027.26, and the added 110.91 points, or 0.99%, at 11,285.32.
Trading volume was thin ahead of Thanksgiving on Thursday, while the US stock market was open for half a session on Friday.
Earlier on Wednesday, a mixed bag of economic data led to a drop in yields on the benchmark 10-year Treasury bill, sending shares higher.
The number of Americans filing new claims for unemployment benefits rose more than expected last week and US business activity contracted for a fifth straight month in November. Consumer confidence ticked higher and home sales rose above expectations.
“What I think you are seeing is a renewed enthusiasm from investors fueled by those who are seeing that beautiful light at the end of what has been a very dark tunnel. And there has been so much money on the sidelines rushing back into the markets and waiting to get back into action,” said Anson Funds portfolio manager Moez Kassam.
Heavy stocks, including Amazon.com Inc (NASDAQ:) and Meta Platforms Inc, rose 1.00% and 0.72%, respectively.
Tesla (NASDAQ:) Inc jumped 7.82% with Citi group (NYSE:) Upgrading the electric vehicle manufacturer’s inventory to “neutral” from a “sell” rating.
Deere (NYSE:) & Co rose 5.03% after the farm equipment maker reported higher-than-expected quarterly earnings.
Nordstrom Inc (NYSE:) fell 4.24% as the fashion retailer slashed its profit forecast amid heavy price cuts to attract inflation-conscious shoppers.
Volume on US exchanges was 9.25 billion shares, compared to the full-session average of 11.6 billion over the past 20 trading days.
Emerging issues outnumbered the NYSE by a ratio of 1.97 to 1; on Nasdaq, a ratio of 1.61 to 1 was in favor of progress.
The S&P 500 posted 21 new highs in 52 weeks and no new lows, while the Nasdaq Composite posted 97 new highs and 126 new lows.