Investing.com — A day before the Fourth of July holiday, a string of weak economic data stoked hopes of an early interest rate cut, helping the S&P 500 close to a new record high in holiday-shortened trading on Wednesday.
As of 13:00 ET (17:00 GMT), shares were up 0.5% to a new record closing price of 5,534.63. The stock price was down 24 points, or 0.1%, while shares were up 0.8%, to a new record closing price.
Wall Street’s main stock indexes will see shorter trading hours on Wednesday ahead of Thursday’s Independence Day holiday, rebounding from big gains on Tuesday after Federal Reserve Chairman Jerome Powell said he saw some progress in curbing inflation.
Negative economic data surprises, raising expectations of a rate cut. Focus on Federal Reserve Board minutes
The results of the Federal Reserve’s June meeting are scheduled to be released later in the session at 2 p.m. Eastern time, with many eagerly awaiting further clues about the central bank’s thinking on monetary policy and inflation.
Investors will likely seek additional guidance on “the committee’s assessment of the balance of risks, concerns about upward inflationary pressures and further insights into the downgrade to rate cut expectations,” Stifel said in a Wednesday note.
On the economic front, data showed that U.S. manufacturing orders unexpectedly fell and U.S. services activity turned contraction, signaling a slowdown in the economy and raising hopes of an early interest rate cut.
With the report due for release just days later, the ADP National Employment Flash showed payrolls added 150,000 in June, down from a revised 157,000 gain in May and consistent with slowing labor market momentum.
According to Investing.com, market participants see a 68% chance of the first rate cut coming in September, up from 58% last week.
Skydance nears studio deal, Paramount Global surges, Constellation Brands first-quarter sales miss expectations
Shares of Paramount Global (NASDAQ:) soared more than 11% after Reuters reported that Shari Redstone’s National Amusements had reached a preliminary agreement to sell a controlling stake in the film studio to David Ellison’s Skydance Media.
Beer and wine company Constellation Brands (NYSE:) saw its shares fall more than 3% after the company reported weaker-than-expected first-quarter sales and reaffirmed its outlook.
“The results are subpar but broadly in line with expectations as consensus revenue expectations declined throughout the quarter,” Truist Securities said.
US crude oil inventories fall sharply, energy-related factors drive higher oil prices
Energy stocks were trending higher on Wednesday, supported by gains following reports that crude oil inventories fell by 12.2 million barrels in the week ended June 28, better than expected of a decline of about 400,000 barrels.
Kinder Morgan Inc (NYSE:), Williams Companies Inc (NYSE:) and Schlumberger NV (NYSE:) rose more than 1%.
Biden reportedly considering dropping out of presidential race
On the political front, President Joe Biden is reportedly considering withdrawing from the presidential race against former President Donald Trump if concerns about his candidacy continue following his shaky performance in the recent presidential debates.
It is widely believed that US Vice President Kamala Harris would be Biden’s first choice if he were to drop out of the race.
(Peter Nurse and Amber Warrick contributed to this article.)
