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US open: Stocks start on front foot ahead of FOMC minutes
Wall Street stocks rebounded on Wednesday, with the mood lifted by a pair of positive business surveys ahead of the release of the minutes from the latest Federal Reserve policy meeting.
At 1500 GMT, the Dow Jones Industrial Average and S&P 500 were up 0.27% and 0.44% respectively, while the Nasdaq had seen a 0.57% uptick.
The looming release of the FOMC meeting minutes saw currency traders sitting on their hands.
Craig Erlam, senior market analyst at Oanda, reminded that the sell-off in the markets earlier this month was initially triggered by a more hawkish sounding Fed, with the jobs report then being the straw that broke the camel's back two days later.
"While the minutes may not generate quite the same response, traders will likely monitor what they say very closely for signs that policy makers are now leaning more towards three to four rate hikes this year, rather than two or three," he said.
Capital Economics analyst Andrew Hunter said the minutes from the meeting on 31 January may bolster expectations of a 25 basis points rate hike in March, although this is almost fully discounted in markets already.
"The policy statement provided a more upbeat assessment of activity while revealing a growing confidence among Fed officials that inflation is set to rebound this year. The minutes will provide more detail on how many officials shared that view. While January's meeting preceded the sharp falls in equity prices over the past couple of weeks, officials have not sounded too concerned and the stock market now appears to be rebounding."
Macro data was showing continued strength in the US economy, with IHS Markit's flash manufacturing purchasing managers' index for February rising to a three-and-a-half-year high of 55.9 from 55.5, while a similar services barometer posted a climb from 53.3 to 55.9.
Looking at prices, a key concern of the FOMS, the report pointed out that the cost of raw and partly finished materials rose to their highest level since 2013, potentially indicating a rise in inflation.
"Business activity growth accelerated markedly in February, suggesting the economy is growing at its fastest pace for over two years," said Chris Williamson, chief business economist at IHS Markit. "Even faster growth is signalled for coming months."
Elsewhere, existing-home sales came in at a seasonally adjusted annual pace of 5.38m in January, according to the National Association of Realtors, as sales of previously-owned homes slid 3.2% in January, the second consecutive monthly decline, with sales as a whole coming in 4.8% lower than twelve months earlier, the steepest annual decline in more than three years.
"Realtors in most areas are saying buyer traffic is even stronger than the beginning of last year," said Lawrence Yun, NAR's chief economist.
However, "sales failed to follow course and far lagged last January's pace. It's very clear that too many markets right now are becoming less affordable and desperately need more new listings to calm the speedy price growth."
Minutes from the FOMC's latest meeting are due at 1900 GMT.
In corporate news, Dish Network had fallen 1.95% to $43.70 per share despite posting a big rise in fourth-quarter profit.
Retailer Walmart had dropped 2.30%, seemingly continuing on from heavy losses in the previous session when it reported a weaker-than-expected fourth-quarter profit.
Foot Locker gained 2.18% after saying late on Tuesday that it was lifting its quarterly cash dividend and cutting its yearly capital expenditure programme.
Lending Club lost 5.34% after its fourth-quarter adjusted earnings and sales released late on Tuesday fell short of analysts' expectations.