The Dow Jones Industrial Average closed higher on Wednesday after the index dipped into the negative briefly. Stocks rose across the board after the release of the Fed's May meeting minutes noted that more aggressive tightening may become appropriate depending on the economy.
The May meeting minutes reaffirmed the Fed's stance that additional 50 basis point rate hikes are still very much appropriate over the next couple meetings.
"At present, participants judged that it was important to move expeditiously to a more neutral monetary policy stance. They also noted that a restrictive stance of policy may well become appropriate," the minutes said.
More economic data was released Wednesday. The April durable goods orders report said orders rose 0.4%, and 0.3% excluding transportation, modestly below the Econoday consensus estimates. Core capital goods orders rose 0.3%, also a bit below views.
Homebuilders Rise After Toll Brothers Earnings
Key economic data releases from earlier this week included a disappointing report from the Census Bureau, showing a 16.6% drop in sales of new single-family houses in April 2022 from March.
This sent several homebuilding stocks lower, including building products supplier Builders FirstSource, Atkore and residential homebuilder Toll Brothers.
But on Wednesday, all three stocks reclaimed some recent losses.
Toll Brothers beat analysts' earnings and sales estimates. Toll Brothers reported earnings of $1.85 a share on sales of $2.3 billion. Analysts had expected earnings of $1.63 a share on sales of $2.1 billion. Shares gained 7% on the news.
Dow Jones Closes Higher After Choppy Session
At the close, the Dow Jones Industrial Average traded up 0.6% while the S&P 500 was up around 1%. Meanwhile, the small-cap Russell 2000 rose 1.8% while the Nasdaq led the upside with a 1.5% gain. According to early data, volume was running mildly lower on the Nasdaq and a whisker higher on the NYSE vs. the close on Monday.
On Wednesday, most of the S&P 500 sectors traded higher. The SPDR Consumer Discretionary ETF led the upside with a gain of nearly 3%. The utilities sector was the only key S&P sector that fell. SPDR Utilities edged less than 0.1% lower.
Blue chips outperforming in the Dow Jones industrials on Wednesday included American Express, which rose 3%. On the downside, Procter & Gamble and Johnson & Johnson led with losses of 1% or more.
In general, the market has hosted few opportunities for breakouts recently. But on Wednesday, a stock from the MarketSmith Growth 250 index scored a breakout.
World Wrestling Entertainment broke out from a 63.81 flat base. Shares gained 3.4% in a heavy volume move that looked strong.
Also, the stock's RS line is reaching new highs which is favorable for the breakout.
WWE spent a number of weeks on the Leaderboard Watchlist.
Follow Rachel Fox on Twitter at @IBD_RFox for more Dow Jones and stock market commentary.
