Mid-Day Update: Fearing Hawkish Language, Stocks Cautious Ahead FOMC Minutes

Stocks were largely treading water Wednesday,inching cautiously higher as Wall Street holds off on any big bets ahead of the release of minutes from the July Federal Open Markets Committee meeting. After two days of very strong gains carrying the S&P 500 just shy of the 2,000 mark and the Nasdaq Composite index climbing to a 14-year high, the risk for a more hawkish bias from Federal Reserve policy-makers has stalled the recent rally and pushed investors to the sidelines. Equities also have been weighed down by a modest sell-off in the UK tied to Bank of England policy meeting minutes as well as disappointing financial results from Lowe's ( LOW ), Target ( TGT ) and Hertz ( HTZ ).

The dearth of economic data this morning left the FOMC minutes as the only market-moving event of the day. While Fed Chair Janet Yellen is expected to maintain a consensus of continued accommodation, the interest-rate landscape has changed with the release of positive housing market data and another strong jobs report last week. This could translate into a more hawkish tone to the latest minutes, possibly destabilizing the bullish undertone to equities.

Minutes from the Aug. 7 Bank of England policy meeting showed that Governor Mark Carney lost his consensus and picked up two new dissenting votes and recent inflation data, economic risks from geo-political events in Europe and flat UK GDP seeming to have teamed up to shelve a rate hike until next year. But with two members voting to raise rates, the risk of higher UK rates earlier than expected drove European equities lower.

Crude oil was up $0.75 to $95.22 per barrel. Natural gas was down $0.05 to $3.86 per 1 million BTU. Gold was down $2.70 to $1,294.30 an ounce, while silver was up $0.06 to $19.54 an ounce. Copper was up $0.07 to $3.19 per pound.

Among energy ETFs, the United States Oil Fund was up 0.10% to $34.75 with the United States Natural Gas Fund was down 1.55% to $20.98. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was up 0.04% to 26.72 while SPDR Gold Shares was down 0.17% $124.47. The iShares Silver Trust was up 0.15% to $18.73.

Here's where the U.S. markets stand at mid-day:

NYSE Composite Index up 2.43 (+0.02%) to 10,932.09

Dow Jones Industrial Average up 30.03 (+0.18%) to 16,949.62

S&P 500 up 1.93 (+0.10%) to 1,983.53

Nasdaq Composite Index up 1.23 (+0.03%) to 4,528.75


Nikkei 225 Index up 0.03%

Hang Seng Index up 0.15%

Shanghai China Composite Index down 0.23%

FTSE 100 Index down 0.35%

CAC 40 down 0.32%

DAX down 0.21%


NYSE Energy Sector Index uip 1.10%

NYSE Financial Sector Index unchanged

NYSE Healthcare Sector Index down 0.03%


(+) CPAH (+31.16%) Signed a strategic channel agreement with "major" supplier of networking equipment to sell communications systems

(+) AEO (+9.84%) Beats street on EPS and revenues despite year-over-year decline

(+) FOLD (+23.41%) Reports positive data in Fabry Disease treatment study


(-) RGSE (-15.86%) Roth Capital downgrade to Neutral , price target slash following disappointing Q2 results

(-) NBY (-34.99%) Fails to meet endpoints in conjunctivitis study, no plans to further study of NVC-422

(-) HTZ (-9.68%) Expects 2014 results well below low end of guidance

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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