US Equity Indexes Pare Gains After Hawkish Fed Minutes

04:46 PM EST, 02/18/2026 (MT Newswires) -- US equity indexes trimmed gains on Wednesday after Federal Open Market Committee meeting minutes showed policymakers allowing for a possible increase in interest rates if inflation rebounds.

The Nasdaq Composite rose 0.8% to 22,753.64, with the S&P 500 up 0.6% to 6,881.31, and the Dow Jones Industrial Average 0.3% higher at 49,662.66.

Minutes of the Jan. 27-28 meeting showed diversity among policymakers, with some advocating for further rate cuts, a few saying the FOMC should pause for the foreseeable future, and others suggesting the next rate move could be upward if inflation rebounds.

"Several participants indicated that they would have supported a two-sided description of the committee's future interest-rate decisions, reflecting the possibility that upward adjustments to the target range for the federal funds rate could be appropriate if inflation remains at above-target levels," the central bank's January meeting minutes stated, according to a note from Stifel.

"The vast majority of participants judged that downside risks to employment had moderated in recent months while the risk of more persistent inflation remained," the Stifel note cited the meeting minutes.

US Treasury yields rose, with the 10-year higher by 3.1 basis points to 4.09%.

At the close, energy, consumer discretionary, and technology led the gainers, while utilities and real estate were the worst performers. All but three sectors rose.

Meta Platforms (META) said late Tuesday that it has entered a multiyear partnership with Nvidia (NVDA) to build hyperscale data centers using millions of Blackwell and Rubin GPUs alongside Arm-based Grace CPUs. Shares of Nvidia (NVDA) rose 1.6%.

iShares Expanded Tech-Software Sector ETF (IGV), with assets of about $6 billion, climbed 1.3% to $82.36, reflecting a diminishing of the AI-scare trade that recently hit software companies particularly hard.

In the energy market, West Texas Intermediate crude oil futures soared 4.8% to $65.31 a barrel.

"The risk of sudden escalation -- given the US buildup of military assets and Iranian threats -- is likely to sustain a geopolitical risk premium, currently estimated at US$3-5 per barrel," Saxo Bank noted, referring to the indirect talks between Washington and Iran in Geneva, Switzerland.

Peace talks between Ukraine and Russia in Geneva collapsed after two hours, Reuters reported, as Ukrainian President Volodymyr Zelensky called the negotiations difficult and accused Russia of stalling the talks to end the war.

In precious metals, gold futures jumped 2% to $5,002.9 per troy ounce, and silver futures surged 5% to $77.20 per troy ounce.

Meanwhile, in economic news, new orders for US durable goods fell by 1.4% in December, following a 5.4% increase, above expectations for a 2.0% decrease in a Bloomberg-compiled survey.

US industrial production rose by 0.7% in January, compared with expectations for a 0.4% gain in a Bloomberg-compiled survey, and following a downwardly revised 0.2% advance in December, according to the Federal Reserve.

The New York Federal Reserve's services index deteriorated to minus 25.7 in February from minus 16.1 in January, compared with the minus 14.2 anticipated in a Bloomberg-compiled survey.

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