S&P 500 hits record after Fed holds steady on rate policy
The S&P 500 hit an intra-day record high on Wednesday after the U.S. Federal Reserve held interest rates and its monthly bond-buying program steady and gave no sign it was ready to reduce its support for the recovery.
Despite the improving economy, the Fed repeated the guidance it has used since December, saying it must see “substantial further progress” towards its inflation and employment goals before stepping back from its monthly bond purchases. read more
“The Fed underscored a lot of uncertainty remains. In this kind of a backdrop, with inflation being transitory, they’ll continue to be pedal to the metal in terms of monetary policy,” said Kevin Flanagan, head of fixed income strategy at WisdomTree Funds.
The S&P 500 was mostly unchanged immediately after the Fed’s announcement, but it later rose after Fed Chair Jerome Powell said in a press conference that it was “not time yet” to discuss reducing the Fed’s support for the recovering economy.
U.S. President Joe Biden is expected to unveil a sweeping $1.8 trillion package for families and education in his first joint speech to Congress on Wednesday, senior White House officials said. read more
Google parent Alphabet Inc (GOOGL.O) jumped about 4% after reporting late Tuesday a record profit for the second consecutive quarter and announcing a $50 billion share buyback. read more
Both Alphabet and the S&P 500 communication services sector (.SLPRCL), which includes the company, also hit record highs.
Apple (AAPL.O) was mostly unchanged and Facebook (FB.O) was up nearly 2% ahead of their quarterly reports after the bell.
The Dow Jones Industrial Average (.DJI) was down 0.18% at 33,922.8 points, while the S&P 500 (.SPX) gained 0.25% to 4,197.31.
The Nasdaq Composite (.IXIC) added 0.2% to 14,117.98.
Microsoft Corp’s (MSFT.O) quarterly report late on Tuesday met sales expectations and beat profit estimates, but its shares fell over 2% and pressured the Nasdaq due to skepticism about one-off benefits included in the results and high hopes after a year-long rally.
Boeing Co (BA.N) fell about 3% after posting a wider-than-expected quarterly loss and pausing 737 MAX deliveries over an electrical issue that has partly re-grounded the fleet. read more
Overall earnings per share for S&P 500 companies in the first quarter are expected to jump 39.2% from a year earlier, according to Refinitiv IBES data.
Advancing issues outnumbered declining ones on the NYSE by a 1.48-to-1 ratio; on Nasdaq, a 1.31-to-1 ratio favored advancers.
The S&P 500 posted 77 new 52-week highs and no new lows; the Nasdaq Composite recorded 106 new highs and 21 new lows.