Stock Market Today: Dow Closes Higher as Fed Minutes Revive Bid in Tech

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Stock Market Today: Dow Closes Higher as Fed Minutes Revive Bid in Tech

By Yasin Ebrahim

Investing.com -- The Dow closed higher Wednesday, after the Federal Reserve's May meeting minutes showed the central bank was keen to move quickly on rate hikes to allow breathing room to reassess the pace of  tightening later this year.

The Dow Jones Industrial Average gained 0.6%, or 191 points, the Nasdaq was up 1.5%, and the S&P 500 added 0.95%.

"[P]articipants judged that it was important to move expeditiously to a more neutral monetary policy stance," the minutes showed. 

The need to hike rates quickly is a "red flag because it tells you that they need to move expeditiously in case of an impending recession," Johan Grahn, head of ETF Strategy at Allianz told Investing.com in an interview on Wednesday.

Front loading rate hikes would allow the central bank breathing room to consider a policy readjustment later this year. 

"I believe that they will follow through on the 50 basis point rate hikes in June and July because that will give them the best opportunity to adjust later," Grahn added.

Tech cut losses after the release of the minutes, buoyed by big tech, with Apple (NASDAQ: AAPL ), and Alphabet (NASDAQ: GOOGL ) cutting losses to end the day well above session lows. 

Consumer discretionary stocks did most of the heavy lifting for the broader market after Nordstrom's quarterly results helped improve sentiment on retailers.

Nordstrom (NYSE: JWN ) reported a wider than expected loss in the first quarter , but revenue jumped to pre-pandemic levels to top Wall Street expectations, sending its shares more than 13% higher.

“JWN has demographics and product category skew advantages at this point in the re-open,” said Credit Suisse (SIX: CSGN ), but also flagged concerns about the uncertain economic backdrop of retailers in the second of half of the year.

Dick’s Sporting Goods (NYSE: DKS ) reported a softer outlook for the full year, but first-quarter results beat on both the top and bottom lines. Its shares gained nearly 10%.

Urban Outfitters (NASDAQ: URBN ) also reported record sales that overshadowed weaker-than-expected earnings and the impact of rising costs. Wall Street also pointed to strength in the retailer’s Anthropologie and Free People Movement brands.

“Despite the miss…sales at Anthro and FP Movement continue to perform well due to demand for apparel, dresses, and fashion,” B. Riley said in a note. “We continue to believe that URBN has upside as Anthro is seeing a recovery as consumers look for fashion and occassionwear.”

Bath & Body Works (NYSE: BBWI ), Under Armour (NYSE: UAA ), and Ralph Lauren Corp (NYSE: RL ) were among the biggest gainers, while a climb in Tesla (NASDAQ: TSLA ) also supported the sector.

Housing stocks, led by Toll Brothers (NYSE: TOL ), were also in ascendency, shrugging off recent data pointing to a slowdown in the housing market.

Toll Brothers reported better-than-expected quarterly results , buoyed by strong demand for housing, though the home builder highlighted the impact of rising mortgage rates and softer macroeconomic conditions.

Lennar (NYSE: LEN ), PulteGroup Inc (NYSE: PHM ), and TRI Pointe Homes (NYSE: TPH ) were higher.

In other news, Beyond Meat (NASDAQ: BYND ) jumped more than 13% after the meatless company announced an endorsement deal with influencer Kim Kardashian.

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