As investors analysed recent remarks made by Federal Reserve officials for clues about the future direction of interest rates and concentrated on the movement of Treasury yields, U.S. equities saw minimal movement on Wednesday.
The yield on US Treasury bonds has dropped significantly from its recent highs. Encouraged by a weaker-than-expected employment data, the benchmark 10-year Treasury note had risen over 5% on mounting predictions that the Fed had reached the end of its rate-hike cycle. With Tuesday’s closing, the S&P 500 and the Nasdaq have seen their longest winning streaks in two years thanks in part to that decline.
According to FedWatch from the CME Group, markets are pricing in a roughly 50% possibility of a rate decrease of at least 25 basis points as early as May.
However, remarks made by a number of central bank officials in recent days have left the door open for further rises, which has some investors nervous.
As for the rest of them, well, everyone knows they’re probably done, or at least we’re going to get one more rise’, said Jason Ware, chief investment officer at Albion Financial Group.
“Earnings appear different and equities have a different value in a recession. If not, we’re most likely dealing with a brand-new, early-stage bull market,” he stated.
Investors will be asking themselves that question as they watch rates; the information we learn about yields and economic statistics related to the recession between now and the end of the year will determine the.
The S&P 500 gained 1.90 points, or 0.04%, at 4,380.28, the Nasdaq Composite rose 9.15 points, or 0.07%, at 13,649.01, and the Dow Jones Industrial Average dropped 63.47 points, or 0.19%, to 34,089.13.
In contrast, Fed Chair Jerome Powell made no mention of monetary policy during his opening remarks on Wednesday at the US central bank statistics conference. On Thursday, he has another conference speech set.
The $40 billion auction was regarded by experts as unimpressive, and the rate on the 10-year Treasury scarcely changed.
After stating that Hollywood strikes and a sluggish advertising market might harm next year’s revenues, Warner Bros Discovery’s earnings fell 17.1%, which was felt by rival Paramount Global, which fell 8.2%.
Among the 11 major S&P sectors, tech led advances, while utilities and energy had the worst returns, each down by more than 1%.
After the firm announced that a trailer for the newest game in its popular “Grand Theft Auto” videogame series will be released early next month, Take-Two Interactive Software saw a 6.4% increase in stock price.
Lucid Group, a developer of electric vehicles, fell 8.3% after lowering its production estimate.
On the NYSE, declining items exceeded advancers by a ratio of 1.3 to 1, while on the Nasdaq, the opposite was true—declining issues outweighed advancers by a ratio of 1.7 to 1.