NEW YORK: US banking stocks surged Wednesday while the broader S&P 500 finished nearly unchanged as Federal Reserve meeting minutes boosted the odds for a June interest rate increase.
The record from the Fed's April policy meeting showed the central bankers keeping the door open to raising interest rates in June, pointing to stronger US growth in the second quarter.
"The Fed's goal is to send a message," said Gregori Volokhine, president of Meeschaert Financial Services.
"The Fed wants the market to take the possibility of a rate hike seriously."
The minutes propelled shares of large banks higher, as they stand to win higher profits if interest rates are hiked. JPMorgan Chase rose 3.9 percent, while both Citigroup and Bank of America each rose by almost five percent.
But the prospect of tighter money weighed on the rest of the market. The Dow Jones Industrial Average dipped less than 0.1 percent to 17,526.62.
The broad-based S&P 500 rose less than 0.1 percent to 2,047.63, while the tech-rich Nasdaq Composite Index climbed 0.5 percent to 4,739.12.
Bigger gainers in the Nasdaq included Apple, which rose 1.1 percent, and Tesla Motors, which climbed 3.2 percent following an upgrade by Goldman Sachs.
Big-box retailer Target was one of the biggest losers, tumbling 7.6 percent following a disappointing second-quarter forecast that showed the continued drag from a tough market for retailers.
Other large retailers were also in retreat, including Walmart, which fell 3.0 percent, and Costco Wholesale, which lost 1.6 percent. Walmart is scheduled to report earnings on Thursday.
Home-improvement retailer Lowe's rose 3.3 percent as it reported first-quarter net income of $884 million, up 31.4 percent from the year-ago period.
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