By Lawrence Delevingne

BOSTON (Reuters) -U.S. stocks were flat or down and Treasury yields largely unchanged Wednesday morning following earlier gains to start the new year and ahead of key Federal Reserve meeting minutes to be released later in the day.

The Dow Jones Industrial Average fell 13.26 points, or 0.04%, to 36,786.39; the S&P 500 lost 2.9 points, or 0.06%, to 4,790.64; and the Nasdaq Composite dropped 45.86 points, or 0.29%, to 15,576.86.

With U.S. inflation surging, investors will be looking at the minutes from the Fed’s December meeting, set for release at 2 p.m. EST (1900 GMT), for signs of how willing policymakers are to tighten monetary policy and, if so, how quickly.

“It’s all about the degree to which the evidence in the minutes suggests that the majority of the committee is looking for a faster-than-expected pace of balance-sheet reduction,” said Peter Chatwell, head of multi-asset strategy at Mizuho.

With expectations for rate hikes as early as March, Treasury yields jumped on Monday and Tuesday. But on Wednesday they pulled back slightly, with the U.S. 10-year yield at 1.6543%, compared with the previous session’s peak of 1.686%, which was the highest since late November.

One positive economic indicator on Wednesday was the ADP National Employment report, which showed private payrolls increased by 807,000 jobs last month, more than double what economists polled by Reuters had forecast.

Citing an optimistic corporate earnings forecast, market analysts at Citi raised their 2022 S&P 500 index price target to 5,100, a 7% gain from year-end 2021.

“We remain moderately constructive on the broader market outlook, while acknowledging valuation headwinds as the Fed moves down a more hawkish path,” the Citi analysts wrote.

Citi’s target was toward the higher end of other banks, with Morgan Stanley at 4,400 and Goldman Sachs also at 5,100.

“It’s still very much start-of-the-year mode,” said Chatwell of Mizuho. “Risk appetite is, as is seasonally the case, strong at this point, and the consensus view is that there is good upside still in equity markets.”

Oil prices extended gains on Wednesday, rising toward $81 a barrel after OPEC+ producers stuck to an agreed output target rise for February and investors assessed the impact of a spike in COVID-19 cases caused by the Omicron variant.

U.S. crude rose 0.78% to $77.59 per barrel and Brent was at $80.69, up 0.86% on the day.

The U.S. dollar index was down around 0.4% on the day, having edged down below recent two-week highs.

In cryptocurrencies, bitcoin was up about 1.7% at $46,617 – still significantly below its most recent all-time high of $69,000 reached in November.

A new research note from Goldman Sachs said that bitcoin will take market share away from gold as a “store of value” in 2022 as digital assets become more widely adopted.

Spot gold added 0.8% to $1,828.66 an ounce. U.S. gold futures gained 0.06% to $1,815.10 an ounce.

(Reporting by Lawrence Delevingne, Elizabeth Howcroft and Medha Singh; editing by Catherine Evans, Chizu Nomiyama and Jonathan Oatis)