NEW YORK (AP) — U.S. stocks held steady Wednesday after the Federal Reserve said it was leaving its main interest rate, which can affect the broad economy and financial markets worldwide, unchanged.
The S&P 500 rose 0.1% and pulled within 1.1% of its all-time high, which was set earlier this month. The Dow Jones Industrial Average was up 107 points, or 0.2%, as of 2:05 p.m. Eastern time, and the Nasdaq composite was 0.1% lower.
The Fed last month raised
its main interest rate for the first time in three years in hopes of slowing the high inflation that’s squeezing the economy and discouraging Americans. Most of Wall Street expected the Fed to hold the federal funds rate steady this time, though. Higher rates slow inflation by making it more expensive to borrow money, which grinds down on the economy.
Higher rates also push downward on stock prices, which raises the pressure on companies to deliver big growth in profits. Several companies rallied Wednesday after joining the list of those beating analysts’ expectations for the summer.
GE HealthCare Technologies jumped 8.1% after delivering both profit and revenue for the summer that surpassed analysts’ expectations. It also raised its forecasts for revenue growth and other financial measures for the full year.
Etsy climbed 5.9% after its profit for the latest quarter blew past analysts’ forecasts. CEO Kruti Patel Goyal said the online marketplace saw growth in active buyers from prior-year levels for the first time in two years, while its active seller base grew at its fastest rate in two years.
Stocks in the artificial-intelligence industry were also relatively solid. They’ve stabilized this week following big swings on worries that high borrowing costs will undercut the boom in AI data centers largely built with borrowed money.
AI stocks got an additional boost after a major player in the industry, South Korea’s SK Hynix, soared 10.9% in Seoul following its latest profit report. The seller of memory chips said it’s in the midst of a virtuous cycle of rising AI usage, and it expects demand to continue to outpace supply through 2030.
On Wall Street, Micron Technology rose 4.3% and was the strongest force lifting the S&P 500. It also sells memory for computers.
Outside of tech, Wendy's jumped 14.6% to $7.05 after Trian Fund Management, run by investor Nelson Peltz, offered to buy the chain for $7.35 per share in cash.
That helped offset a drop for Boston Scientific, which fell 3.6% even though the seller of medical devices reported a milder drop in profit for the latest quarter than analysts expected. It gave a forecast for profit in the current quarter that fell short of analysts’ expectations.
Robinhood Markets sank 4.1% after reporting weaker profit and revenue for the latest quarter than analysts expected.
In the bond market, Treasury yields rose, and the yield on the 10-year Treasury climbed to 5.03% from 4.99% late Tuesday.
Two Fed officials, Lisa Cook and Beth Hammack, said they wanted the Fed to raise its federal funds rate on Wednesday. They voted for an increase of a quarter of a percentage point for the fed funds rate from its current range of 3.75% to 4%, though everyone else on the Fed's policymaking committee voted to keep it steady.
The two-year Treasury yield, which moves more closely with expectations for Fed action, rose to 4.77% from 4.70% late Tuesday.
The 10-year Treasury yield remains near the high end of its range since shooting upward from 3.97% when the war with Iran sent oil prices and worries about inflation much higher. But it’s pulled back after topping 5.30% earlier this month and touching its highest level since 2002.
Rising oil prices pushed upward on Treasury yields Wednesday as uncertainty continues about what will happen in the Middle East and the global energy industry. The price for a barrel of Brent crude, the international standard, climbed 2% to $111.59.
In stock markets abroad, South Korea’s Kospi jumped 6.6% following SK Hynix’s leap. Japan’s Nikkei 225 rose 1.1%, while France’s CAC 40 edged down by less than 0.1%.
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AP Writer Elaine Lai contributed to this report.
