The S&P 500 erased modest gains earlier and closed in the red on Wednesday as the market’s comeback rally took a breather.

The broad equity benchmark dipped 0.1% to 4,241.84, falling for the first day in three and sitting 0.4% from an all-time high. 

Leading the losses were the S&P 500 utilities sector, which dropped 1.1% Wednesday, while consumer staples and materials also registered modest declines.

Despite Wednesday’s dip, the S&P 500 has risen 1.8% this week, bouncing back from a sell-off last week triggered by the Federal Reserve’s surprise policy shift. The central bank projected much higher inflation for the year than previously, while signaling two rate increases as soon as 2023.
 

Plan A : Long if market supported firm above 4242. Targets are 4258, 4275 and 4288.

Plan B : Short if market failed to support above 4242. Targets are 4215, 4189 and 4161.

Stock futures rose mildly after the market’s comeback rally hit a speedbump on Wednesday.

The Nasdaq Composite was the relative outperformer with a 0.1% gain at 14,271.73, eking out another record closing high.

Despite Wednesday’s hiccup, the three major indexes are up more than 1% this week, rallying from a sell-off last week after the Federal Reserve heightened inflation expectations and forecast rate hikes as soon as 2023.

Investors await new jobless claims data set to be released Thursday for the latest outlook on unemployment.

The Fed's annual bank stress test results are scheduled for release after the bell on Thursday. The test examines how banks fare during various hypothetical economic downturns. After the Fed’s results, banks typically announce how much capital they can release in the form of dividends and buybacks.
 

Plan A : Long if market supported firm above 14286. Targets are 14321, 14350 and 14385.

Plan B : Short if market failed to support above 14286. Targets are 14244, 14201 and 14161.
 

Plan A : Remain buy as long as oil price trades resiliently above 72.8. Targets are 73.3 and 74.3.

Plan B : Consider short only if oil price fails to stay firm above 72.8. Targets are 71.9 and 71.1.