Marketbites: Federal Reserve "Minutes" Released
Portfolio Manager Commentary:
Stocks ended lower on Wednesday as traders parsed through a summary of the Federal Reserve’s most recent meeting, looking for clues on the central bank’s next move against inflation. The Fed’s meeting minutes showed inflation remained “well above” the central bank’s 2% target, adding that the labor market is still “very tight, contributing to continuing upward pressures on wages and prices.”
Fed officials also noted that “inflation data received over the past three months showed a welcome reduction in the monthly pace of price increases but stressed that substantially more evidence of progress across a broader range of prices would be required to be confident that inflation was on a sustained downward path,” the minutes said.
LPL Financial’s chief global strategist Quincy Krosby said that the release of the meeting minutes did not change the market’s trajectory, as investors remain steadfast in their belief that the Fed will not continue much further with its rate hikes.
Shares of Palo Alto Networks popped 12.5% after the cybersecurity company lifted its earnings forecast for the year. Crypto exchange platform Coinbase topped revenue expectations, but shares fell 1.4%.
Chart of the Day:
The U.S. housing market weakened in January for the 12th straight month as continued high mortgage rates kept buyers sidelined. January’s decline marked the longest streak of back-to-back monthly declines on record going back to 1999. Existing-home sales fell last year to the lowest level since 2014 due to a surge in mortgage rates and record-high home prices. This combination raised the cost of many home purchases by hundreds of dollars a month. The drop in affordability, along with general economic uncertainty, pushed many buyers out of the market.