Stocks closed lower on Wall Street Wednesday after minutes from the Federal Reserve’s last meeting raised expectations that the central bank will move faster to raise interest rates to fight inflation. The S&P 500 fell 92.96 points, or 1.9%, to 4,700.58. Drops in major technology stocks were the biggest weight on the market. The tech-heavy Nasdaq 522.54 points, or 3.3%, to 15,100.17 . The Dow Jones Industrial Average of 30 blue-chip companies slipped 392.54 points, or 1.1%, to 36,407.11, easing back from the record high it set a day earlier, the AP reports. Small-company stocks also posted sizable losses. Bond yields rose after the Fed minutes came out.
The Fed minutes showed that the central bank's policymakers at their meeting last month expressed concerns that surging inflation was spreading into more areas of the economy and would last longer than they previously expected. The Fed officials also concluded that the US job market was nearly at levels healthy enough that the Fed’s low-interest rate policies were no longer needed. For both those reasons, Fed Chair Jerome Powell said after the Dec. 14-15 meeting that the central bank was accelerating the reduction of its ultra-low interest rate policies. Wall Street appeared to read the minutes as a sign that the central bank will be perhaps more aggressive about rolling back the economic stimulus policies it put in place after the pandemic, which could mean a faster road to higher interest rates.
Roughly 65% of stocks in the benchmark S&P 500 were down. Technology companies, which led gains on Monday and then pulled the broader market lower on Tuesday, were the biggest weigh on the index. Microsoft fell 3.8% and software maker Adobe shed 7.1%. A mix of retailers and other companies that rely on consumer spending also lost ground. Tesla slid 5.4% and Amazon fell 1.9%. AT&T rose 2.2% after giving investors an encouraging update on subscriber growth.
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