NEW YORK, July 29 ― The S&P 500 ended little changed yesterday but off its session lows after the Federal Reserve said the US economic recovery remains on track and Chair Jerome Powell said the central bank was still a ways away from considering raising interest rates.
Keeping the market in check, shares of tech giant Apple Inc fell 1.2 per cent after it forecast slowing revenue growth.
In a news conference following the release of a new policy statement from the Fed, Powell also said the US job market still had “some ground to cover” before it would be time to pull back from the economic support the US central bank put in place in the spring of 2020 to battle the coronavirus pandemic's economic shocks.
“It looks like probably the most positive thing for the market was that they are nowhere near increasing interest rates,” said Alan Lancz, president, Alan B. Lancz & Associates Inc, an investment advisory firm based in Toledo, Ohio.
Right after the Fed statement, the S&P 500 index reversed slight declines though it still ended a hair lower on the day.
Investors have been worried about how rising inflation and a spike in Covid-19 cases might impact the central bank's plan to potentially start withdrawing its stimulus.
The central bank also said that higher inflation remained the result of “transitory factors.” The Fed kept its overnight benchmark interest rate near zero and left unchanged its bond-buying programme.
The Nasdaq ended higher and shares of Google parent Alphabet Inc hit an all-time high as a surge in advertising spending helped it post record quarterly results. The stock ended up 3.2 per cent.
The Dow Jones Industrial Average fell 127.59 points, or 0.36 per cent, to 34,930.93, the S&P 500 lost 0.82 point, or 0.02 per cent, to 4,400.64 and the Nasdaq Composite added 102.01 points, or 0.7 per cent, to 14,762.58.
The Fed's statement came at the conclusion of its latest two-day policy meeting.
“They had a chance to signal they were going to become more hawkish and they chose not to take it. The most important thing is they are predictable and they are remaining predictable,” said Ellen Hazen, portfolio manager at FL Putnam Investment Management in Wellesley, Massachusetts.
In other earnings news, Microsoft Corp ended down 0.1 per cent even as a boom in cloud services helped it beat Wall Street expectations for revenue and earnings.
Volume on US exchanges was 9.86 billion shares, compared with a similar average for the full session over the last 20 trading days.
Advancing issues outnumbered declining ones on the NYSE by a 1.85-to-1 ratio; on Nasdaq, a 2.61-to-1 ratio favoured advancers.
The S&P 500 posted 42 new 52-week highs and no new lows; the Nasdaq Composite recorded 44 new highs and 67 new lows. ― Reuters
