NEW YORK: Wall Street's main indices ended with modest declines on Wednesday (July 5) as investors digested minutes from the US Federal Reserve’s (Fed) latest meeting and braced for significant economic data in the days to come.
Minutes showed a united Fed agreed to hold interest rates steady at the June meeting as a way to buy time and assess whether further rate increases would be needed.
“Almost all officials expected additional rate hikes this year,” said a note from Oxford Economics. “The hawkish wing of the Fed is making the most noise, suggesting that the Fed isn’t done tightening monetary policy.”
Following the release of the anticipated minutes, investors still largely expected the central bank to raise rates at its next meeting later this month. Key economic data is due before the meeting, including the monthly US jobs report on Friday.
“The markets are in a wait-and-see for the economic data,” said Paul Nolte, senior wealth advisor and market strategist at Murphy & Sylvest Wealth Management. “Since the Fed is data dependent, so is the market.”
The Dow Jones Industrial Average fell 129.83 points, or 0.38%, to 34,288.64, the S&P 500 lost 8.77 points, or 0.20%, to 4,446.82 and the Nasdaq Composite dropped 25.12 points, or 0.18%, to 13,791.65.
Materials fell most among S&P 500 sectors, shedding 2.5%.
In data out on Wednesday, new orders for US-made goods increased less than expected in May, fanning fears of an economic slowdown. Meanwhile, China’s services activity expanded at the slowest pace in five months in June, according to a private-sector survey.
Chip stocks fell after China said it would control exports of some metals widely used in the semiconductor industry as tensions between Beijing and Washington rise over access to high-tech microchips.
The Philadelphia SE Semiconductor Index dropped 2.2%, while Intel shares sank 3.3% and Texas Instruments declined 1.8%.
Shares of Meta Platforms rose 2.9% ahead of the expected release of the company's Twitter-rival app, Threads, on Thursday.
“We could see the largest stocks pull back, but the average stock catch up,” said Jack Ablin, chief investment officer at Cresset Capital. “We are looking for somewhat of a convergence.”– Reuters, AFP
Source: The Sun Daily
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