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Stocks end mixed despite Fed support

09/16/2020 | 05:58pm

A mixed reaction on Wall Street Wednesday after a big announcement from the Federal Reserve.

After its two-day policy meeting, Fed Chief Jerome Powell indicated interest rates will stay near zero at least until 2023 - a bold promise aimed at offsetting years of weak inflation and allowing the economy to keep adding jobs.

"Overall activity remains well below its level before the pandemic, and the path ahead remains highly uncertain. We now indicate that we expect it will be appropriate to maintain the current zero to one quarter percent target range for the federal funds rate until labor market conditions have reached levels. Levels consistent with the committee's assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time." But investor response was muted.

The Dow rose 36 points for its fourth straight daily gain. But the S&P 500 snapped a three-day winning streak and the Nasdaq ended lower - both weighed down by Facebook, Apple, Google parent Alphabet, Amazon, Netflix and Tesla.

Summit Place Financial Advisors' Liz Miller sees Wednesday's Fed action as a long-term support to the market.

"I think the Fed's statement today lays the groundwork for the Nasdaq to come back. We just had a short-term correction that was extremely healthy. Certainly there's a lot of appetite and positive sentiment still in this market."

Speaking of hungry investors, Wall Street gobbled up the most valuable-ever IPO for a software company. Shares of the Warren Buffett-backed cloud software company Snowflake more than doubled in their debut.

© Thomson Reuters 2020
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