US stocks slide from record levels after Fed minutes reveal concern for economic recovery

US stocks slide from record levels after Fed minutes reveal concern for economic recovery
Spencer Platt/Getty Images
  • US stocks slid on Wednesday as investors mulled the cautionary remarks from Federal Reserve officials.
  • Federal Open Market Committee meeting minutes showed policymakers fearing a slowdown in the economy's recovery. Members also refrained from issuing forward guidance on when it would enact new policies.
  • The S&P 500 finished lower after reaching an intraday record high for a second straight day. On Tuesday, the benchmark index closed at its first all-time high since February.
  • Investors also weighed signs of mild stimulus progress. House Speaker Nancy Pelosi suggested on Tuesday that Democrats might nix some facets of their proposal to expedite a relief package and reconsider passing those elements after November's elections.
  • Oil slightly declined as new virus outbreaks abroad stoked demand worries. West Texas Intermediate crude slipped as much as 1.2%, to $42.36 per barrel.
  • Watch major indexes update live here.

US equities slid on Wednesday as wary remarks from the Federal Reserve's latest minutes overshadowed strong earnings reports.

Central bank officials raised concerns about the economic recovery sputtering out during the Federal Open Market Committee's July meeting, the minutes showed. Members "agreed that the ongoing public health crisis would weigh heavily on economic activity, employment, and inflation in the near term."

The S&P 500 edged higher to a second consecutive intraday record before sliding on the Fed's comments. In a reversal from recent trends, the Nasdaq composite lagged behind its peers as tech shares underperformed cyclical plays.

Here's where US indexes stood at the 4 p.m. ET market close on Wednesday:

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Retail stocks were boosted by strong earnings from Target and Lowe's. The former leaped after beating Wall Street estimates and reporting record same-store sales growth. Lowe's similarly gained after reporting that growing interest in do-it-yourself projects drove 30% revenue growth.

Investors also mulled new signs of progress in reaching a stimulus deal. House Speaker Nancy Pelosi suggested on Tuesday that Democrats might cut down its fiscal relief proposal to speed up negotiations, adding that measures removed from the smaller bill would be reassessed after November's elections.

Republican leaders also hinted at resuming talks. Senate Majority Leader Mitch McConnell said Pelosi's decision to strike $25 billion in Postal Service funding was enough to restart negotiations. The Senate is on recess until September but could reconvene should lawmakers reach a compromise.

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Hopes for an expedited deal were somewhat offset by fears about schools and colleges starting new terms as virus cases remain elevated. Several universities have pivoted to fully online classes after on-campus coronavirus outbreaks. Experts worry that some schools' lax enforcement of social-distancing measures could fuel a new wave of virus hot spots in the US.


The S&P 500 closed at its all-time high on Tuesday following the index's multiple attempts in recent weeks to retrace its virus-driven losses.

Apple became the first US-based company to reach a $2 trillion intraday market cap before paring gains and falling below the threshold. Oil titan Saudi Aramco became the first company to reach the $2 trillion level after its December IPO.

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Tire-maker Goodyear tumbled after President Donald Trump told his Twitter followers to boycott the company, saying it was banning employees from wearing his signature MAGA hat. Goodyear said in a statement the slide was not "created or distributed" by Goodyear corporate.

In deal news, Momenta Pharmaceuticals soared after the biotech company agreed to a $6.5 billion acquisition by Johnson & Johnson. The deal valued Momenta shares at a 70% premium and is expected to close in the second half of 2020, a press release said.


Oil pared some declines after tumbling on continued demand risks. West Texas Intermediate crude fell as much as 1.2%, to $42.36 per barrel. Brent crude, oil's international benchmark, slid 1.4%, to $44.81, at intraday lows.

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