US stocks ended Wednesday's session higher as traders weighed the concerns expressed by Federal Reserve officials at their most recent policy meeting against key data showing the US economy is slowing.
The S&P 500 and the Nasdaq 100 both recovered from two days of losses. Treasuries finished mixed on Wednesday after paring gains. The value of the dollar fell.
Meeting minutes from the December meeting of the Federal Open Market Committee revealed officials warning that a "unwarranted" loosening of financial conditions would complicate their efforts to meet their inflation target. Policymakers were also concerned that if the labor market remained resilient, inflation would remain entrenched.
While officials appeared to recognise the importance of balancing two-sided risks, the meeting minutes highlighted that the Fed will have much more to do if markets do not cooperate.
On Wednesday, investors also assessed a slew of economic data. The latest Institute for Supply Management data highlighted improved supply chain conditions, declining input prices, and slower demand — all of which the Fed would welcome. However, data on job openings indicated a strong labour market, which shook sentiment earlier in the session.
All eyes will be on the Nonfarm payrolls report on friday, for any indications of possible softening in the labor market.