US Stocks fall as Fed minutes hints further rate hike ahead

The US stocks were mostly lower on Wednesday, 22 February 2023, with the Nasdaq closing in green, while the Dow and the S&P 500 indexes finished below neutral line after flitting between small gains and losses, as the minutes from the Federal Reserve's February meeting revealed that further rate hikes are in the pipeline to squeeze inflation.

At the close of trade, the Dow Jones Industrial Average index declined 84.50 points, or 0.26%, to 33,045.09. The S&P500 index was down 6.29 points, or 0.16%, to 3,991.05. The tech-heavy Nasdaq Composite Index added 14.77 points, or 0.13%, to 11,507.07.

Total 9 of 11 sectors ended lower along with the S&P500 Index. Real estate was the worst performing sector, falling 1.02%, followed by energy (down 0.77%) and utilities (down 0.42%) sectors. Materials was top performing sector, rising 0.68%.

The mixed finish of the Wall Street was chiefly due to the release of the minutes of the Federal Reserve's January 31-February 1 monetary policy meeting revealing a "few participants" favored raising rates by 50 basis points compared to the 25 basis point rate hike that was ultimately announced. The minutes acknowledged that inflationary pressures have moderated but noted price growth remains well above the Fed's 2 percent target, with labor market tightness contributing to continuing upward pressures on wages and prices.

Most of the major sectors ended the day, with oil service stocks showed a substantial move to the downside, driven by falling oil prices amid pressure from a stronger dollar and concerns that tighter monetary policy could dent energy demand.

The earnings front, meanwhile, offered a mixed picture, with retailers continuing to dominate investor focus. TJX Companies shares closed 2% lower as the company reported in-line fourth-quarter earnings, but guidance fell short of Wall Street estimates.

Intel Corporation shares fell more than 2% as the company cut its quarterly dividend by more than 65% to shore up its balance sheet.

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