Fed Minutes, Retail Sales, Bitcoin Bounce: 3 Things to Watch

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Investing.com — Stocks continued their record-setting march higher and bitcoin briefly traded above $50,000, a key psychological hurdle as the cryptocurrency quickly gains mainstream acceptance.

The Dow Jones Industrial Average and S&P 500 both touched new all-time intraday highs after traders returned from a three-day weekend in the U.S., only to lose steam late in the session.

Among the day’s standouts, energy stocks gained as a storm and deep freeze in the South cut electricity to millions of households. Bank stocks also rose on Tuesday on optimism for the economic recovery.

More vaccines are slated for delivery as more Americans get their first doses and new cases and deaths continue to fall.

Here are three things that could affect markets tomorrow.

1. FOMC minutes

Last month the Federal Reserve kept its easy money policy in place as it continued efforts to boost the economy. On Wednesday, we get a closer look at its deliberations at that meeting with the release of the Federal Open Market Committee’s January minutes at 2:00 PM ET (1900 GMT).

Business activity slowed again with Covid’s surge late last year, but now vaccines promise better days ahead. President Joe Biden’s $1.9 trillion stimulus, which is still being debated on Capitol Hill, could offer another boost to a recovering economy, though the Fed has pledged it will do what it can to support growth.

2. Retail sales for January

Another barometer for the health of the American consumer is retail sales, and the data for January are due out Wednesday at 8:30 AM ET (1350 GMT). 

Analysts tracked by Investing.com expect the retail number to be 1.1% compared to a decline of 0.7% in December.

3. Bitcoin surges past $50,000

The increasingly popular cryptocurrency pierced through $50,000 and then settled back in the high $48,000s, but that didn’t stop people from talking about it all day. Bitcoin surged more than 300% last year and is up about 70% this year as high-profile companies jump in.

Last week, Tesla Inc (NASDAQ:TSLA) sent the crypto surging after saying it bought $1.5 billion worth of it. ON Tuesday, a business intelligence company called MicroStrategy Incorporated (NASDAQ:MSTR) said it was going to sell $600 million of convertible notes to invest the proceeds in more bitcoin. It did a similar deal in December.

Investors are undoubtedly wondering just how much further bitcoin can go. Some experts believe it could double from here, especially if companies follow Tesla and others and invest in it as an inflation hedge.