* Fed policymakers discussed possibility of 50 bp rate cut
* Target , Lowe's jump after better-than-expected results
* Toll Brothers falls on declining orders
* Indexes up: Dow 0.93%, S&P 0.82%, Nasdaq 0.90%
(Updates to market close)
By April Joyner
NEW YORK, Aug 21 (Reuters) - Wall Street's main indexes rose
on Wednesday as upbeat earnings from retailers pointed to
strength in U.S. consumer demand, and held gains after minutes
from last month's Federal Reserve meeting showed policymakers
had debated a more aggressive interest rate cut.
U.S. stocks moved solidly higher following
better-than-expected results from retailers Target Corp (NYSE:TGT) TGT.N
and Lowe's Cos Inc LOW.N . Target shares surged 20.4% after the
big-box retailer raised its annual earnings forecast. Lowe's
shares climbed 10.4% after the home-improvement chain beat
profit estimates. Robust U.S. consumer spending has helped stave off fears of
an impending recession. Concerns about an economic slowdown rose
as the yield curve between 2-year and 10-year Treasuries briefly
inverted last week. Though the yield curve again briefly
inverted on Wednesday, it had little impact on stocks this time
around.
"As long as we have the healthy environment in jobs that we
have right now, it's going to be very difficult to shake
people's confidence," said JJ Kinahan, chief market strategist
at TD Ameritrade in Chicago. "At the end of the day, if people
are employed, they're going to go out and spend some money."
Minutes from the Fed's policy-setting meeting on July 30-31,
when the Fed cut rates by 25 basis points, showed that
policymakers debated cutting rates more aggressively. Some
participants preferred a 50-basis-point cut, but the committee
was united in wanting to avoid the appearance of being on a path
to further rate cuts. The Dow Jones Industrial Average .DJI rose 240.29 points,
or 0.93%, to 26,202.73, the S&P 500 .SPX gained 23.92 points,
or 0.82%, to 2,924.43 and the Nasdaq Composite .IXIC added
71.65 points, or 0.90%, to 8,020.21.
Fed Chair Jerome Powell is scheduled to speak on Friday at
the Jackson Hole, Wyoming, central bankers' conference. Several
market strategists said Powell's comments at the conclave would
offer greater insight on the course of monetary policy than the
minutes from the July Fed meeting given developments since then,
including U.S. President Donald Trump's announcement of tariffs
on an additional $300 billion worth of Chinese goods.
The minutes "gave very little forward guidance," said Robert
Phipps, director at Per Stirling Capital Management in Austin,
Texas. "Jackson Hole is going to be (Powell's) first chance to
really talk since the latest tariff announcement."
On Wednesday, the nonpartisan Congressional Budget Office
said changes in U.S. and foreign trade policies since January
2018 would reduce inflation-adjusted U.S. gross domestic product
by 0.3% from what it would be otherwise by 2020. Among individual stocks, shares of Toll Brothers Inc TOL.N
slipped 4.5% after the luxury homebuilder posted a decline in
orders, hinting at weaker demand for new homes. Advancing issues outnumbered declining ones on the NYSE by a
2.51-to-1 ratio; on Nasdaq, a 2.14-to-1 ratio favored advancers.
The S&P 500 posted 31 new 52-week highs and five new lows;
the Nasdaq Composite recorded 59 new highs and 67 new lows.
Volume on U.S. exchanges was 5.68 billion shares, compared
with the 7.53 billion-share average for the full session over
the last 20 trading days.