Despite the release of inflation data and the minutes of the Federal Reserve’s meeting for the month of March, Wall Street’s march continued unabated. Wall Street found itself slightly in the green despite the factors that could have put it on the red, and tech stocks drove much of the rally. There were worries that the Fed was going to raise interest rates shortly but the fact that the key indices held firm amid all that is a clear indication that any rise in interest rates is not going to take place in the near future. On the other hand, the Dow also found itself in the green after the blue chip corporations in the index had shown some weakness over the past weeks due to the industrial stocks, which had been lagging behind.
According to experts on Wall Street, the minutes of the Fed meeting was in line with what investors had expected and hence, the street did not miss a beat once they were published. A senior executive at San Francisco based Wedbush Securities said as much. He said, “The Fed notes were kind of a nothing, exactly what the market was expecting. It’s how the Fed likes to operate. They wanted to reaffirm existing expectations, which they did.” At a time when there were fears that the Fed might be looking to raise interests, it comes as a big relief for Wall Street that it is not going to happen and many analysts now believe that the status quo is here to stay for some time yet.
The Fed is known to raise interest rates every three years, but the inflation data further reaffirmed its stand not to raise the interest rates at this point of time. The core items that make up the consumer price index in the United States rose at a crawling pace, and that is another big reason behind the Fed’s actions. Another top executive from a wealth management firm stated, “The core number shows no inflation and the headline reflects higher gasoline prices, which is a headwind for growth, a tax on consumers.” Amid all this, it is important to keep in mind that according to many analysts’ estimates, the profits for the first quarter at most of the leading banks on Wall Street are going to be disappointing.
