S&P 500 Futures Extend Winning Streak as FOMC Minutes Reveal Split Over Interest Rates

U.S. stocks pared gains on Wednesday amid signs that a fissure was developing on the Federal Reserve’s policy-setting board.

The S&P 500 Index rose 0.1% to close at 2,468.11, where it was little changed for the day. The index was up by as much as 0.4% earlier.

Nine of 11 sectors registered gains, with materials leading the rally. The sector climbed 0.9% on strong gains at metals and mining companies.

Discretionary shares were up 0.5%. Utilities rose 0.3%, while industrials and healthcare rose at least 0.2% apiece.

Gains in these sectors were partially offset by a sharp drop in energy shares as oil prices faced a fresh retreat. Energy stocks fell 1.1% on Wednesday.

Financials stocks were also down 0.2% to round out the losers.

A measure of 30-day volatility known as the CBOE VIX declined on Wednesday as markets continued to stabilize from last week’s volatile drop. The VIX continues to show below-normal volatility on Wall Street.

The minutes of the July Federal Open Market Committee (FOMC) on Wednesday revealed a growing division about the future of monetary policy. One side is cautioning against raising interest rates in a low-inflation environment while the other is concerned about the impact of delaying.

The minutes said “some participants… argued against additional adjustments” until the Fed was sure that inflation was on track to meet its 2% target.

Policymakers kept rates on hold last month, but have hiked three times since December.

The next FOMC meeting is scheduled for September 19-20 in Washington. The rate announcement will be accompanied by quarterly projections covering GDP, unemployment and inflation.

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Sam Bourgi is a financial market analyst for economiccalendar.com. He has more than six years of progressive experience in economic and financial analysis, research consulting and sectoral analysis. As a published author in government, peer-reviewed, online and industry sources, he has developed a fundamental approach to the financial markets with a broad focus on stock indices, commodities and the technology sector. He earned his Bachelor’s Degree from the University of Windsor and Master’s degree from McMaster University.