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Most U.S. stocks were little changed Wednesday as Federal Reserve minutes offered investors few new insights about a next interest-rate increase.
Investors had come to expect that the Fed would raise short-term interest rates in December, with recent comments from Fed officials bolstering the case. But minutes from the Fed’s September meeting show that while some policy makers called for a rate increase “relatively soon,” members clashed over the timing of the move.
Dividend-paying stocks led Wednesday’s gains, recovering slightly after falling out of favor in recent months. Yield-hungry investors had bid up these sectors for their dividend payments in the first half of the year. Real-estate stocks in the S&P 500 rose 1.3%, while utility stocks rose 1%.
“The yield play is happening because people are going to question whether or not the Fed is actually going to pull the trigger in December,” said Ray Moore, a trader at Raymond James. “The market interpreted the Fed minutes and believes a rate increase this year is less likely.”
ENLARGE
The pound recovered during Asian trading hours following media reports that British Prime Minister Theresa May might have agreed to hold a parliamentary vote on her Brexit plans. But the U.K. won’t be given a vote on the formal Brexit process.
Photo:
Agence France-Presse/Getty Images
The Dow Jones Industrial Average edged up 15.54 points, or 0.1%, to 18144.20. The S&P 500 rose 2.45 points, or 0.1%, to 2139.18, while the Nasdaq
Composite edged down 7.77 points, or 0.1%, to 5239.02.
The yield on the 10-year U.S. Treasury note rose to 1.778%, from 1.760% Tuesday, paring gains after investors found little in the Fed minutes to reaffirm expectations of a rate increase before year-end. Yields rise when prices fall.
Investors are turning their attention to earnings. Aluminum giant Alcoa
fell 80 cents, or 2.9%, to $27.11 a day after losing 11% as it announced disappointing third-quarter earnings—kicking off the U.S. earnings season on a down note.
In the three quarters in which Alcoa has fallen more than 10% following its earnings report, the S&P 500 traded down 7.5%, 2.6%, and 6.5% for the rest of those three earnings seasons, according to Bespoke Investment Group.
Shares of Illumina fell 2.81, or 2%, to 136.18 after tumbling 25% a day earlier on news that the company was cutting its revenue guidance. Health-care stocks in the S&P 500 led declines for the second session in a row, while the Nasdaq Biotechnology Index lost 2.5%.
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U.S. crude oil fell 1.2% to $50.18 a barrel, briefly dipping below $50 a barrel intraday, after the Organization of the Petroleum Exporting Countries said its production rose last month. OPEC members had reached an accord last month to cut production, though details on how to execute it are still being negotiated.
Investors also are skeptical about whether Russia will join OPEC’s plan, with Russian President Vladimir Putin speaking Wednesday about a freeze in production without mentioning cuts.
Overseas, the Stoxx Europe 600 fell 0.5%. The British pound gained 0.7% against the dollar to $1.2207 after four consecutive days of losses. The pound touched a historic low against a basket of currencies on Tuesday, according to Bank of England data. It recovered during Asian trading hours, rising more than 1.5% against the dollar, after media reports suggested that U.K. Prime Minister Theresa May had agreed to hold a parliamentary vote on her plans for taking Britain out of the European Union.
London’s export-heavy FTSE 100 index, which touched its highest level in decades on Tuesday, pulled back 0.7% as the pound recovered.
DJIA Leaders and Laggards - 1 Day
The WSJ Dollar index, which measures the dollar against a basket of 16 other currencies, rose 0.2%.
Shares in Asia fell on continued expectations for a U.S. rate increase in December. Japan’s Nikkei Stock Average fell 1.1%, and Hong Kong’s Hang Seng
Index shed 0.6%.
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—Hiroyuki Kachi and Matthias Verbergt contributed to this article.
Write to Daniel Huang at dan.huang@wsj.com and Riva Gold at riva.gold@wsj.com
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