U.S. Stocks Move To The Downside Following Fed Minutes

(RTTNews) - After seeing modest strength earlier in the session, stocks came under pressure in afternoon trading on Wednesday. The downturn by the major averages came after the Nasdaq and S&P 500 hit record intraday highs.

The major averages climbed off their lows in the final minutes of trading but remained in negative territory. The Dow dipped 85.19 points or 0.3 percent to 27,692.88, the Nasdaq slid 64.38 points or 0.6 percent to 11,146.46 and the S&P 500 fell 14.93 points or 0.4 percent to 3,374.85.

The weakness that emerged on Wall Street came following the release of the minutes of the Federal Reserve's latest monetary policy meeting.

The minutes of the Fed's July meeting noted that the coronavirus outbreak is causing tremendous human and economic hardship across the United States and around the world.

The Fed noted economic activity and employment have picked up somewhat in recent months but remain well below their levels at the beginning of the year.

"The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term," the Fed said.

Gold stocks showed a substantial move to the downside on the day, dragging the NYSE Arca Gold Bugs Index down by 3.4 percent.

The sell-off by gold stocks came amid a steep drop by the price of the precious metal, with gold for December delivery plunging $42.80 to $1,970.30 an ounce.

Significant weakness also emerged among biotechnology stocks, as reflected by the 2.6 percent slump by the NYSE Arca Biotechnology Index. The index ended the session at its lowest closing level in two months.

Commercial real estate, oil and steel stocks also moved to the downside on the day, contributing to the downturn by the broader markets.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index rose by 0.3 percent, while China's Shanghai Composite Index tumbled by 1.2 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the French CAC 40 Index advanced by 0.8 percent, the German DAX Index and the U.K.'s FTSE 100 Index climbed by 0.7 percent and 0.6 percent, respectively.

In the bond market, treasuries turned in lackluster performance being ending the day little changed. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point at 0.675 percent.

Looking ahead, trading on Thursday may be impacted by reaction to the Labor Department's weekly jobless claims report.