U.S. stocks closed mixed on Wednesday after the Federal Reserve decided to keep key interest rates unchanged, as expected. The central bank indicated that while the next move would likely be to cut interest rates, sustained progress on inflation remained uncertain.
The Dow Jones Industrial Average made up slight gains, while the S&P 500 and Nasdaq ended the session in the red. The Federal Open Markets Committee concluded its two-day meeting with a unanimous decision to maintain the Fed funds rate target at 5.25% to 5.50%. The timing of a possible rate cut was unclear in an accompanying statement, and Fed officials emphasized their ongoing concerns that the first months of 2024 had not significantly increased their confidence in a decline in inflation.
During a subsequent news conference, Fed Chair Jerome Powell acknowledged that while the central bank remains committed to bringing inflation back to its 2% target, it noted progress toward that goal and rejected the idea of an imminent interest rate boost.
“Powell didn’t impress much,” said Ryan Detrick, chief market strategist at Carson Group in Omaha. “He acknowledged that inflation remains a problem but remained confident that it will improve in the coming quarters.”
“Today’s boost was caused by the statement that the next move will not be a hike,” Detrick added. “He replied strongly. … That allowed the bulls to take over.” Powell also mentioned that the job market is normalizing, citing data released Wednesday that showed the number of job openings dropped to a three-year low.
As the first quarter reporting season passed the halfway point, 310 S&P 500 companies reported earnings. According to LSEG, 77% of these companies reported earnings that exceeded the consensus. Analysts now expect the S&P 500 company’s first-quarter total earnings growth to be 6.6% year-over-year, a significant improvement from the 5.1% estimate as of April 1, according to LSEG data.
Several individual companies experienced significant share price movements. Advanced Micro Devices fell 9.0% on disappointing artificial intelligence chip sales forecasts, while Super Micro Computer fell 14.0% on a lack of quarterly revenue. This indigent performance led to a 3.5% decline in the Philadelphia Semiconductor Index.
Amazon.com, on the other hand, rose 2.2% on better-than-expected quarterly results amid increased interest in artificial intelligence, which helped spur the growth of cloud computing. Johnson & Johnson gained 4.6% after announcing its intention to settle a proposed $6.48 billion settlement over allegations that its baby powder and other talc-containing products cause ovarian cancer.
Starbucks suffered a significant decline of 15.9% after the coffee chain lowered its sales forecast and reported its first decline in same-store sales in almost three years. CVS Health also fell 16.8% after its earnings missed consensus estimates and the health care company lowered its full-year earnings forecast.
The Dow Jones Industrial Average rose 87.37 points, or 0.23%, to 37,903.29, while the S&P 500 lost 17.3 points, or 0.34%, to 5,018.39 and the Nasdaq Composite fell 52.34 points, or 0.33%, to 15,605.48. Of the 11 major sectors in the S&P 500, energy stocks saw the largest percentage declines, while utilities rose.
Newly listed issues outnumbered decliners on the NYSE by a 1.38-to-1 ratio, and on the Nasdaq a 1.50-to-1 ratio favored growth stocks. The S&P 500 recorded 12 recent 52-week highs and 10 recent lows, while the Nasdaq Composite recorded 55 recent highs and 105 recent lows. Volume on U.S. exchanges was 12.26 billion shares, compared with the average of 11.08 billion for the full session over the last 20 trading days.
(With the participation of the agency)
The Dow Jones Industrial Average made up slight gains, while the S&P 500 and Nasdaq ended the session in the red. The Federal Open Markets Committee concluded its two-day meeting with a unanimous decision to maintain the Fed funds rate target at 5.25% to 5.50%. The timing of a possible rate cut was unclear in an accompanying statement, and Fed officials emphasized their ongoing concerns that the first months of 2024 had not significantly increased their confidence in a decline in inflation.
Raise
During a subsequent news conference, Fed Chair Jerome Powell acknowledged that while the central bank remains committed to bringing inflation back to its 2% target, it noted progress toward that goal and rejected the idea of an imminent interest rate boost.
“Powell didn’t impress much,” said Ryan Detrick, chief market strategist at Carson Group in Omaha. “He acknowledged that inflation remains a problem but remained confident that it will improve in the coming quarters.”
“Today’s boost was caused by the statement that the next move will not be a hike,” Detrick added. “He replied strongly. … That allowed the bulls to take over.” Powell also mentioned that the job market is normalizing, citing data released Wednesday that showed the number of job openings dropped to a three-year low.
Raise
As the first quarter reporting season passed the halfway point, 310 S&P 500 companies reported earnings. According to LSEG, 77% of these companies reported earnings that exceeded the consensus. Analysts now expect the S&P 500 company’s first-quarter total earnings growth to be 6.6% year-over-year, a significant improvement from the 5.1% estimate as of April 1, according to LSEG data.
Several individual companies experienced significant share price movements. Advanced Micro Devices fell 9.0% on disappointing artificial intelligence chip sales forecasts, while Super Micro Computer fell 14.0% on a lack of quarterly revenue. This indigent performance led to a 3.5% decline in the Philadelphia Semiconductor Index.
Amazon.com, on the other hand, rose 2.2% on better-than-expected quarterly results amid increased interest in artificial intelligence, which helped spur the growth of cloud computing. Johnson & Johnson gained 4.6% after announcing its intention to settle a proposed $6.48 billion settlement over allegations that its baby powder and other talc-containing products cause ovarian cancer.
Starbucks suffered a significant decline of 15.9% after the coffee chain lowered its sales forecast and reported its first decline in same-store sales in almost three years. CVS Health also fell 16.8% after its earnings missed consensus estimates and the health care company lowered its full-year earnings forecast.
The Dow Jones Industrial Average rose 87.37 points, or 0.23%, to 37,903.29, while the S&P 500 lost 17.3 points, or 0.34%, to 5,018.39 and the Nasdaq Composite fell 52.34 points, or 0.33%, to 15,605.48. Of the 11 major sectors in the S&P 500, energy stocks saw the largest percentage declines, while utilities rose.
Newly listed issues outnumbered decliners on the NYSE by a 1.38-to-1 ratio, and on the Nasdaq a 1.50-to-1 ratio favored growth stocks. The S&P 500 recorded 12 recent 52-week highs and 10 recent lows, while the Nasdaq Composite recorded 55 recent highs and 105 recent lows. Volume on U.S. exchanges was 12.26 billion shares, compared with the average of 11.08 billion for the full session over the last 20 trading days.
(With the participation of the agency)
