Stock Market Update

[BRIEFING.COM] The S&P 500 (+0.87%) is in "last" place among the major averages, little changed following the release of the FOMC's April 28-29 meeting minutes.

The April FOMC minutes point to a Fed still operating in a data-dependent mode amid elevated uncertainty, with the Middle East conflict and energy prices continuing to shape inflation expectations and market sentiment. Equity markets recovered earlier losses, Treasury yields moved modestly higher, and near-term inflation expectations ticked up, while longer-term expectations remained anchored near 2%.

Participants noted market pricing still shows little expected change in the policy rate this year, with survey data implying two 25 basis point cuts over the next year, though pushed further into late 2026 and early 2027. Financial conditions and liquidity remained stable, with funding markets operating smoothly and reserves still considered ample.

On the economic backdrop, inflation rose into the low-to-mid 3% range, driven mainly by energy and related pass-through effects, while the labor market remained steady near 4.3% unemployment. GDP growth picked up in Q1, supported by resilient consumer spending, corporate earnings, and continued AI-related investment.

The staff outlook showed slightly stronger growth, with output expected to run modestly above potential and unemployment near its longer-run rate. Inflation is projected to gradually return toward 2% as temporary energy and conflict-related pressures fade, though risks remain tilted to higher inflation and weaker growth due to geopolitical and structural uncertainty.