STORY: U.S. stocks ended mixed on Wednesday after the Federal Reserve left its key interest rate unchanged as expected, but left the timing of any rate cut in doubt.
The Dow gained nearly a quarter of a percent, while the S&P 500 and Nasdaq each shed roughly a third of a percent.
The Fed concluded its two-day monetary policy meeting with Chair Jerome Powell noting that while the annual inflation rate has dropped significantly, further progress is “not assured” and the path forward on rates is “uncertain.”
Eric Diton is president and managing director of The Wealth Alliance.
“Let’s start with a with a quote that stuck with me throughout my 38 years of doing this. There are two groups of people, those who don’t know where interest rates are going, and those who don’t know that they don’t know where interest rates are going. And even Jay Powell is in the first group. He doesn’t know where interest rates are going. You ask him he says, ‘I’m data dependent.’ And he is.”
Wednesday’s decision to keep rates steady follows a run of disappointing economic data in recent months, including inflation readings.
But Powell said the labor market was normalizing, citing data released on Wednesday showing job openings dropping to a three-year low.
Meanwhile, first-quarter reporting season has passed the halfway point, with more than 300 of the companies in the S&P 500 having reported. Of those, 77% posted consensus-beating earnings, according to LSEG.
Shares of Amazon rose more than 2% on better-than-expected quarterly results as interest in artificial intelligence helped drive cloud-computing growth.
But shares of Advanced Micro Devices shed 9% after its disappointing AI chip sales forecast, while Super Micro Computer slid 14% following the company’s quarterly revenue miss.
And Starbucks shares tumbled almost 16% after the coffee chain cut its sales forecast as it posted the first drop in same-store sales in nearly three years.
Source Agencies
