U.S. stocks closed slightly lower on Wednesday following the release of minutes from the Federal Reserve’s latest meeting, which indicated that the central bank intends to maintain high interest rates and potentially raise them further. The Dow experienced a decline of approximately 0.4%, while the S&P 500 and Nasdaq both recorded losses of about 0.2%.
The minutes from the Fed’s policy meeting showcased an ongoing concern over elevated prices. However, Jay Hatfield, the CEO of Infrastructure Capital Advisors, believes that next week’s inflation data will reveal a significant decrease in price pressures. This anticipated drop can be attributed to lower gas prices, which Hatfield argues will challenge Fed hawks who are committed to another rate hike. He suggests that the market’s prediction of an 86% probability for a rate hike this month is too high, estimating the actual likelihood to be closer to 50/50.
Investors are eagerly awaiting the release of Friday’s jobs report, according to Hatfield. He believes that until then, the stock market may experience a temporary pause.
In relation to specific stocks, chip stocks witnessed a decline after China announced its intention to control exports of certain metals commonly used in the semiconductor industry. This development comes amidst escalating tensions between Beijing and Washington over access to high-tech microchips. In other news, shares of Meta Platforms saw an increase ahead of the anticipated launch of its Twitter-rival app, Threads, on Thursday. Conversely, United Parcel Service (UPS) experienced a drop in share price after the Teamsters Union claimed the shipping giant had walked away from negotiations regarding a new contract. UPS has denied these allegations.
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