US stocks close mixed as Powell signals pause in rate cuts
US stocks ended mixed on Wednesday after Federal Reserve Chair Jerome Powell suggested the central bank may hold off on further interest rate cuts this year. The Dow Jones Industrial Average fell 74.37 points, or 0.16 percent, to 47,632.00. The S and P 500 edged down 0.30 points, or less than 0.01 percent, to 6,890.59, while the Nasdaq Composite Index rose 130.98 points, or 0.55 percent, to 23,958.47. Seven of the 11 primary S and P 500 sectors ended lower, with real estate and consumer staples leading the laggards by losing 2.66 percent and 2.00 percent, respectively. Technology and communication services outperformed, advancing 1.05 percent and 1.04 percent, respectively.
The Fed lowered its benchmark overnight lending rate by 25 basis points to a range between 3.75 percent and 4 percent at the conclusion of its two-day policy meeting, marking the second rate cut this year. Before the decision, markets widely expected another reduction in December. However, Powell tempered expectations, saying "a further reduction in the policy rate at the December meeting is not a foregone conclusion."
"Powell is reflecting the tension on the Fed between those who favor more aggressive easing and those who are concerned that inflation remains too high, even as the labor market weakens," said Michael Rosen, chief investment officer at Angeles Investments. Investors are also watching earnings from the "Magnificent Seven" group. Alphabet, Meta Platforms, and Microsoft are scheduled to report later Wednesday, followed by Apple and Amazon on Thursday.
REUTERS
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