| |
US Stocks Steady Ahead of Fed Decision 10/28 09:39
U.S. stocks are drifting Wednesday as the countdown ticks toward this
afternoon's announcement from the Federal Reserve on what it will do with
interest rates.
NEW YORK (AP) -- U.S. stocks are drifting Wednesday as the countdown ticks
toward this afternoon's announcement from the Federal Reserve on what it will
do with interest rates.
The S&P 500 rose 0.1% and pulled within 1.1% of its all-time high, which was
set earlier this month. The Dow Jones Industrial Average was up 144 points, or
0.3%, as of 10:15 a.m. Eastern time, and the Nasdaq composite was down by less
than 0.1%.
The day's highlight will likely be what the Federal Reserve says, if
anything, about where interest rates are heading. The Fed raised its main
interest rate last month for the first time in three years in hopes of slowing
the high inflation that's squeezing the economy and discouraging Americans.
The widespread expectation on Wall Street is that the Fed will leave the
federal funds rate alone at this meeting, and the question is whether it will
give hints about what may happen at later meetings. Fed Chairman Kevin Warsh,
though, has been adamant since taking over the Fed about wanting it to give
fewer indications about its future moves.
Wall Street cares so much about interest rates because they are one of the
main levers that set prices for stocks. The other big variable is how much
profit companies are making, and several companies rallied Wednesday after
joining the list of those beating analysts' expectations for the summer.
GE HealthCare Technologies jumped 7.8% after delivering both profit and
revenue for the summer that surpassed analysts' expectations. It also raised
its forecasts for revenue growth and other financial measures for the full year.
Etsy climbed 4.9% after its profit for the latest quarter blew past
analysts' forecasts. CEO Kruti Patel Goyal said the online marketplace saw
growth in active buyers from prior-year levels for the first time in two years,
while its active seller base grew at its fastest rate in two years.
Stocks in the artificial-intelligence industry were also relatively solid.
They've stabilized this week following big swings on worries that high
borrowing costs caused by high interest rates will undercut the boom in AI data
centers largely built with borrowed money.
AI stocks got an additional boost after a major player in the industry,
South Korea's SK Hynix, soared 10.9% in Seoul following its latest profit
report. The seller of memory chips said it's in the midst of a virtuous cycle
of rising AI usage, and it expects demand to continue to outpace supply through
2030.
On Wall Street, Micron Technology rose 4.4% and was the strongest force
lifting the S&P 500. It also sells memory for computers.
They helped offset a drop for Boston Scientific, which fell 8.1% even though
the seller of medical devices reported a milder drop in profit for the latest
quarter than analysts expected. It gave a forecast for profit in the current
quarter that fell short of analysts' expectations.
Robinhood Markets sank 3% after reporting weaker profit and revenue for the
latest quarter than analysts expected.
In the bond market, Treasury yields held relatively steady ahead of the
Fed's announcement. The yield on the 10-year Treasury rose to 5.01% from 4.99%
late Tuesday.
It's near the high end of its range since it shooting upward from 3.97% when
the war with Iran sent oil prices and worries about inflation much higher. But
it's pulled back after topping 5.30% earlier this month and touching its
highest level since 2002.
Oil prices rose Wednesday as uncertainty continues about what will happen in
the Middle East and the global energy industry. The price for a barrel of Brent
crude, the international standard, climbed 1.8% to $111.33.
In stock markets abroad, South Korea's Kospi led worldwide gains with a jump
of 6.6% following SK Hynix's leap. Japan's Nikkei 225 rose 1.1%, and France's
CAC 40 added 0.1%.
|
|
