Stocks bounce back from initial decline amid U.S.-China trade tensions.
U.S. stocks reversed declines on Wednesday after the Federal Reserve’s latest meeting minutes revealed no urgency on the part of policymakers to raise interest rates more aggressively.
The large-cap S&P 500 Index (NYSEARCA:SPY) rose 0.3% to 2,733.29, with most primary sectors finishing higher. Utilities were the biggest gainers, rising 0.8% as a sector.
The Dow Jones Industrial Average (NYSEARCA:DIA) reversed losses to finish at 24,886.81, where it had gained 0.2% from the previous close. Dow industrials were down triple digits earlier.
Meanwhile, the technology-heavy Nasdaq Composite Index (NYSEARCA:QQQ) jumped 0.6% to close at 7,425.96.
Implied volatility in U.S. equities, as expressed through the CBOE VIX (NYSEARCA:VXX) declined on Wednesday. The so-called “fear index” edged down 4.8% to 12.58 on a scale of 1-100 where 20 represents the historic average.
Sliding commodity prices also placed downward pressure on stocks, as crude oil struggled to regain its recent multi-year high. U.S. West Texas Intermediate (WTI) futures fell 58 cents, or 0.8%, to $71.62 a barrel on the New York Mercantile Exchange. ICE Brent futures declined 4 cents, or 0.5%, to $79.15 a barrel.
In economic data, U.S. new home sales declined last month, as affordability challenges continued to hamper the housing market. The sale of new homes dropped by 1.5% in April to a seasonally adjusted annual rate of 662,000, the Commerce Department reported Wednesday.
The Final Word: Stocks are experiencing downward pressure in the face geopolitical tensions and ongoing trade disputes involving China and NAFTA. Complicating matters is a more assertive Federal Reserve, which is widely expected to raise interest rates next month.