A afternoon rally for the Dow Jones Industrial Average melted on Wednesday as Wall Street struggled to interpret minutes from the Federal Reserve’s January meeting. The Dow was up 18 points, or less than 0.1%, at 24,995, eroding what had been a nearly 300-point rally in the wake of the release of minutes at 2 p.m. Eastern Time. The S&P 500 index was up 5 points, or 0.2%, but had been up more than 1% earlier in the session, while the Nasdaq Composite Index climbed 0.5% at 7,265. A deflation of the brisker rise for stocks following meeting minutes from the late-January gathering of the Federal Open Market Committee was attributed in part a climb in yields for the 10-year Treasury note to a session high at 2.95%, while the dollar, as measured by the ICE U.S. Dollar Index also picked up steam up 0.4% at 90.09. Minutes from the Jan. 30-31 Federal Open Market Committee meeting showed that officials saw a stronger economy than at the end of 2017 and that more rate hikes were in the offing. The strengthening “increased the likelihood that a gradual upward trajectory of the federal funds rate would be appropriate.” To convey this message, officials altered their statement to point to “further gradual increases,” according to the minutes. However, the Fed minutes don’t incorporate recent signs of rapidly rising inflation, which could make the Fed more inclined to hike rates faster than the three that Wall Street is forecasting, some market participants speculated.
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