Wednesday's FOMC minutes showed that despite some dissent, the
Federal Reserve is set to press on with its $85 billion-per-month
asset purchase program.
The continuation of the Fed's dovish monetary policy along
with optimism about the upcoming earnings season triggered a
rally on Wall Street with the Dow climbing triple digits on the
day and the Nasdaq jumping almost 2 percent.
Both the Dow and S&P closed Wednesday's trading session at
new record highs as the U.S. stock market continues its torrid
start to the year.
The Dow Jones Industrial Average rose 127 points, or 0.87
percent, to close at 14,801.
The S&P 500 climbed 19 points, or 1.22 percent, to
The Nasdaq Composite registered a gain of 59 points, or 1.83
percent, to finish at 3,297.
The Federal Open Market Committee released the minutes from
its latest meeting on Wednesday. A number of FOMC members said
that the Federal Reserve should begin tapering its quantitative
easing program in 2013 and move to end it by the beginning of
next year. FOMC members "thought that if the outlook for labor
market conditions improved as anticipated, it would probably be
appropriate to slow purchases later in the year and to stop them
For the time being, however, the committee determined that it
will continue with the Fed's $85 billion per month asset purchase
program until the labor-market outlook has "improved
Crude oil prices were mixed on the session with U.S. benchmark
WTI crude rising and Brent futures falling. Near the close of
equities, WTI contracts trading on NYMEX were up 0.32 percent to
$94.45. Brent crude futures had fallen 0.75 percent to $105.51.
Natural gas rallied nearly 2 percent on Wednesday to $4.09.
Precious metals fell on the session as stocks rose sharply. At
last check, COMEX gold futures were down 1.70 percent to
$1,561.40 while silver futures had shed 0.92 percent to $27.69.
Despite the "risk-on" environment, copper fell 0.62 percent
In the agricultural complex, corn and wheat futures headed in
opposite directions. Heading into the closing bell, corn was
trading up 0.74 percent while wheat had lost a little more than
1.50 percent. Movers in soft commodities included cotton, which
rose 1 percent, and coffee, which added a little less than 0.50
Bond prices fell sharply in the wake of the stock market rally
and the FOMC minutes. Near the close of equities, the iShares
Barclays 20+ Year Treasury Bond ETF (NYSE:
) had lost 1.31 percent to $119.99. As prices fell, yields
The 2-Year Note yield remained unchanged at 0.23 percent. The
yield on the 5-Year Note jumped four basis points to 0.73
percent. The 10-Year Note yield climbed five basis points to 1.81
percent and the yield on the 30-Year Bond moved seven basis
points higher to 3.00 percent.
The U.S. dollar was moderately higher on the session. At last
check, the PowerShares DB US Dollar Index Bullish ETF (NYSE:
), which tracks the performance of the greenback versus a basket
of foreign currencies, has added 0.18 percent to $22.45.
The closely watched EUR/USD pair was last down 0.31 percent to
$1.3059. The greenback continued its meteoric rise against the
Japanese yen on Wednesday with the USD/JPY gaining a little less
than 0.50 percent. Volatility in other major currency pairs was
limited on the session with the biggest mover being the AUD/USD,
which rose 0.34 percent.
Volatility and Volume
The VIX continued to fall on Wednesday amid an ongoing rally
in stocks. The widely watched barometer of market fear lost 2.57
percent on the day to 12.51.
Volume was light even as the Dow and S&P hit new all-time
highs. Only around 112 million SPDR S&P 500 ETF (NYSE:
) shares traded hands on the day compared to a 3-month daily
average of around 123 million.
NII Holdings (NASDAQ:
) continued its huge rally which started last week. The company
sold its Peruvian Nextel business to Chilean telecom operator
Entel for $400 million last week. Near the close, the shares had
climbed better than 11 percent.
) had risen almost 16 percent heading into the close after the
company released better than expected adjusted fiscal Q1
Health Management Associates (NYSE:
) lost more than 16 percent on the session after the company cut
its full-year revenue outlook and said it expects both revenue
and earnings will be below Wall Street expectations.
Titan Machinery (NASDAQ:
) fell around 14 percent on Wednesday after its fiscal
fourth-quarter earnings fell 12 percent and missed consensus
Synergy Pharmaceuticals (NASDAQ:
) lost around 16 percent after the company announced a secondary
offering of common shares.
Pacific Sunwear (NASDAQ:
) had climbed almost 8 percent heading into the closing bell
after the stock was upgraded to "Overweight" at Piper
Actions Semiconductor (NASDAQ:
) climbed more than 10 percent on the session after the company
lifted its first-quarter revenue outlook.
) were trading around 6 percent higher in the wake of the
discount shopping warehouse-operator's fiscal second-quarter
financial results which were released on Tuesday after the
First Solar (NASDAQ:
) was trading down around 7 percent near the close of equities.
The stock soared on Tuesday in the wake of better than expected
full-year guidance and remains sharply higher on the week.
Barrick Gold (NYSE:
) lost more than 8 percent on the day after a Chilean court
suspended work on the company's Pascua Lama mine.
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
Profit with More New & Research
. Gain access to a streaming platform with all the information
you need to invest better today.
Click here to start your 14 Day Trial of Benzinga