U.S. stocks traded narrowly Wednesday as investors waited for the Federal Reserve to announce its decision on interest rates and signal whether policymakers may adjust borrowing costs at future meetings.
The S&P 500 rose 0.1% and moved to within 1.1% of the record high it reached earlier in October. The Dow Jones Industrial Average gained 144 points, or 0.3%, while the Nasdaq composite declined less than 0.1% as of 10:15 a.m. ET.
Markets focus on the Fed’s next signal
The central event for investors was the Federal Reserve’s afternoon announcement. Wall Street broadly expected the central bank to leave the federal funds rate unchanged at this meeting. Attention was focused on whether the Fed would offer any indication about the path of rates at later meetings.
The Fed increased its main interest rate in September, the first increase in three years, as policymakers sought to slow inflation that has been putting pressure on the economy and discouraging consumers. Interest rates are a major factor in stock valuations because they influence borrowing costs and the relative appeal of other investments. Corporate profits are the other major force driving share prices.
Fed Chairman Kevin Warsh has pushed the central bank to provide fewer signals about its future decisions since taking over the institution, adding to the importance investors place on the wording of each policy announcement.
- The S&P 500 was up 0.1% and stood 1.1% below its October record.
- The Dow rose 144 points, or 0.3%.
- The Nasdaq was down by less than 0.1% at 10:15 a.m. ET.
Company results lift individual stocks
Several companies moved higher after reporting summer-quarter results that exceeded analysts’ expectations. GE HealthCare Technologies climbed 7.8% after reporting profit and revenue above forecasts. The company also increased its outlook for full-year revenue growth and other financial measures.
Etsy rose 4.9% after its latest-quarter profit surpassed analysts’ estimates. CEO Kruti Patel Goyal said the online marketplace recorded an increase in active buyers from the prior year for the first time in two years. Etsy’s active seller base also grew at its fastest rate in two years, according to Goyal.
The mixed trading came as investors weighed company earnings against the Fed’s approach to inflation and interest rates. The policy decision was due to provide the next formal update on borrowing costs after the September increase.
