Stocks closed higher on Wall Street Wednesday following the release of minutes from the Federal Reserve’s most recent policy meeting. The S&P 500 rose 13.69 points, or 0.4%, to 3,845.08. The Dow Jones Industrial Average rose 69.86 points, or 0.2%, to 31,037.68. The Nasdaq rose 39.61 points, or 0.3%, to 11,361.85. The minutes of the two-day meeting last month show that Fed officials concluded higher interest rates could be needed to restrain what they saw as a worrying trend: consumers starting to anticipate higher inflation, the AP reports.
The minutes from the Fed's June 14-15 meeting show that officials agreed that the central bank needed to raise its benchmark interest rate to "restrictive" levels that would slow the economy’s growth. The recent pullback in energy prices could mean lower gas prices in a few weeks and could signal that inflation is peaking, along with a cooling housing market. "This takes the pressure off the Fed," says Katie Nixon, chief investment officer for Northern Trust Wealth Management. "If we can see gas prices go down, that will pull through to consumer sentiment and that could give the Fed the ability to at least take some of the pressure off."
The price of US crude oil is still up 36% for the year, but has been slipping throughout the week in a welcome sign for a market hoping for any signal that inflation could be easing. US crude oil fell 1% Wednesday afternoon. The price on Tuesday settled below $100 a barrel for the first time since early May. Small company stocks remained in a slump Wednesday, a sign that investors are worried about economic growth. The Russell 2000 shed 0.8%. Technology and health care stocks accounted for a big share of the benchmark S&P 500 index's gains. Cisco Systems rose 1.7% and Pfizer added 2.2%.
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