Market Wrap: Stocks Advance for Third Day, Despite Fed Minutes

Spencer Platt/Getty Images By KEN SWEET

NEW YORK -- The stock market rose for a third straight day Wednesday despite a report from the Federal Reserve that showed a growing chorus of central bank officials willing to raise interest rates sooner rather than later.

In the bond market, prices fell and yields rose as invest! ors prepared themselves for higher interest rates.

The Dow Jones industrial average (^DJI) rose 59.54 points, or 0.4 percent, to 16,979.13. The Standard & Poor's 500 index (^GPSC) rose 4.91 points, or 0.3 percent, to 1,986.51, less than two points away from its late-July record close of 1,987.98. The Nasdaq composite (^IXIC) was mostly unchanged on the day, falling 1.03 points, less than 0.1 percent, to 4,526.48.

The majority of Fed policymakers believe the U.S. economy is improving enough that the bank should start considering how it's going to start raising interest rates, according to minutes from the bank's latest meeting.

The debate on when the Fed should raise interest rates, which have been near zero since 2008, has intensified in recent months as the central bank winds down its other economic stimulus.

The Fed has been winding down its bond-buying program since December, and is expected to end it completely before the end of the year. Des! pite worries that the Fed's exit might be a net negative for t! he market, stocks have remained resilient. The S&P 500 is up 7.5 percent this year.

Jonathan Corpina, a floor trader at the New York Stock Exchange with Meridian Equity Partners, said investors are prepared to see the Fed raise interest rates.

"We've been talking about raising interest rates for so long, I don't think the Fed is going to surprise anybody when they finally do it," Corpina said.

The Fed's key short-term interest rate influences the prices of a huge array of investments, including Treasuries, other kinds of bonds and stocks. If the Fed were to raise interest rates, investors would demand higher yields on bonds.

The Fed minutes prompted some investors to sell bonds. The yield on the U.S. 10-year Treasury note rose to 2.43 percent from 2.40 percent the day before. Bond yields rise when prices fall.

Trading has been quiet this week as the summer winds down and with many traders on vacation. Tuesday was the third-slowest trading d! ay of the year and Wednesday was 12th-slowest day.

On Friday, Fed Chair Janet Yellen will give a speech at the bank's annual conference in Jackson Hole, Wyoming. The speech is often a venue where the leader of the Fed lays out major policy decisions.

"Janet Yellen's speech in Jackson Hole will most likely guide the markets [now that] earnings season is winding down," Doug Cote, chief market strategist with Voya Investment Management, said.

Benchmark U.S. crude for September delivery rose $1.59 to $96.07 a barrel New York. Oil rose after a report showed U.S. supplies dropped sharply last week as refineries kept busy.

In metals trading, gold fell $1.50 to $1,295.20 an ounce, silver rose 9 cents to $19.50 an ounce and copper rose nine cents to $3.18 a pound.

In individual stocks:

• J.M. Smucker (SJM) fell $1.03, or 1 percent, to $102.42. The food products company, which also owns coffee brands such as Folgers, cut its full! -year sales outlook. The company also said higher coffee prices were im! pacting the company's profit margins.

• PetSmart (PETM) rose 82 cents, or 1 percent, to $70.52 after the company said it was exploring a sale. The pet supply retailer had been under pressure from activist investors to consider a deal or a major restructuring.

• Hertz (HTZ) fell after the rental car company withdrew its full-year profit forecast, citing numerous "operational challenges" related to auto recalls and accounting irregularities. The company said the Ford (F) and GM (GM) recalls hurt its ability to have cars available for customers. Hertz also said its purchase of Dollar Thrifty was not saving as much money as originally hoped. The stock fell $1.23, or 4 percent, to $30.33.

What to Watch Thursday:

• The Labor Department releases weekly jobless claims at 8:30 a.m. Eastern time.
• At 10 a.m., Freddie Mac releases weekly mortgage rates; the National Association of Realtors releases existing home sales for July; the Federal Reserve Bank of Philadelphia releases its survey of manufacturing conditions in the Mid-Atlantic region; and the Conference Board releases leading indicators for July.

These major companies are scheduled to release quarterly financial statement:

• 58.com (WUBA)
• Brocade Communications Systems (BRCD)
• Dollar Tree (DLTR)
• Intuit (INTU)
• GameStop (GME)
• Gap (GPS)
• Hormel Foods (HRL)
• Marvell Technology Group (MRVL)
• Nordson (NDSN)
• Patterson Cos. (PDCO)
• Ross Stores (ROST)
• Salesforce.com (CRM)
• Sears Holdings (SHLD)

• For many employers, open enrollment season for some benefits happens in October. This usually sneaks up on some people, who scramble to decipher benefits and make elections last minute. Although you won't be able to see the options until the enrollment period opens, take time now to review your benefits. Are you taking advantage of any 401(k) matches? Are your fully funding your Flexible Spending Account? What about employer offered life and disability insurance? (A fun infographic from the Council for Disability Awareness shows your risks). Maximize your benefits and don't leave any money on the table.
  ​1. Make the right choices at open enrollment
• Back-to-school time can be expensive if you're not prepared. Money is spent on clothes, books, supplies and technology -- and that's before the doors to the classroom have even opened. Before hitting the stores, do these two things:

  • Conduct an online search for "coupon code" along with the name of any store you'll be shopping at. Typically you can find some great online deals.
  • Get a list from you class or teacher of specific type of notebook, calculator, etc. required. If you can't get child's "must haves" from ahead of time, buy just the bare minimums until school starts and the list is available.
  2. Spend wisely on back-to-school items
• It's hard to think about the holidays when we're just making it through summer, but now is the time to build up a financial cushion. Set yourself up with an automatic transfer to a separate savings account and participate in the Holiday Fund Money Challenge to build up a savings of $450. How much do you need for the gifts, travel, parties, entertaining, food and other holiday activities you anticipate? Planning will help to ease the stress that comes around the holidays.
  ​3. Plan for the end-of-year holidays
• In lieu of scrambling at the end of the year to make contributions to retirement accounts by Dec. 31, double-check your contributions now and determine if there's room in your cash flow to allow for an increase to possibly max out by year end.
  ​4. Maximize your retirement funding
• Summer is a typically a time of transitions. There are weddings, moves to new homes, possibly a new family addition and more. If summer is the time when these events take place, fall should be the time to take stock of how they're panning out. If you're recently married and haven't already, now is the time to have the money talk with your spouse and make decisions about spending plans, merging (or not merging) accounts, beneficiary updates and more. If you've moved, check out how the new location has affected your cost of living spending in terms of activities, gas costs, groceries and more. Ultimately with any transition, you need to review your spending plan and determine what areas (if any) need to be adjusted.
  5. Consider your transitions
• If you're lucky enough to live in one of the states that actually experiences seasons, fall is the time to prep for energy savings by caulking and weatherstripping doors and windows, turning your thermostat back for a fixed period each day and insulating your attic, basement or outside walls.
  6. Weatherproof your home
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Source : http://www.dailyfinance.com/2014/08/20/market-wrap-stocks-advance-despite-fed-minutes/