Stock Market Update

[BRIEFING.COM] The recently released minutes for the September 17–18 FOMC meeting noted that, given the significant progress made since the Committee first set its target range for the federal funds rate at 5¼ to 5½ percent, a substantial majority of participants supported lowering the target range for the federal funds rate by 50 basis points to 4¾ to 5 percent. Still, some participants noted that there had been a plausible case for a 25 basis point rate cut at the previous meeting and that data over the intermeeting period had provided further evidence that inflation was on a sustainable path toward 2 percent while the labor market continued to cool.

As it stands currently, the S&P 500 (+0.45%) is in second place, the major averages now little changed compared to half an hour ago.

Getting back to the minutes, almost all participants saw upside risks to the inflation outlook as having diminished, while downside risks to employment were seen as having increased.

Further, although real GDP growth in the second quarter was stronger than the staff had expected, the forecast for economic growth in the second half of this year was marked down, largely in response to recent softer-than-expected labor market indicators.

Several participants discussed the importance of communicating that the ongoing reduction in the Federal Reserve's balance sheet could continue for some time even as the Committee reduced its target range for the federal funds rate.

Yields came off a bit following the minutes, the yield on the benchmark 10-yr treasury note is up about five basis points at 4.068%.