U.S. stocks moved back into the red Wednesday after the Federal Reserve left interest rates unchanged and said “economic growth slowed” since its last meeting in December.
“Inflation is expected to remain low in the near term,” the Fed said in new, more cautious language, that suggests the central bank won’t be quick to raise interest rates again.
“Lower oil prices and weak global economic growth would make the Fed more cautious about its tightening policy. The second interest rate increase in March has become unlikely,” said Jia Liu, research fellow at the American Institute for Economic Research in emailed comments.
Dow industrials, which had turned a 150-point drop to a modest gain earlier in the session, declined again after the announcement.
The Dow Jones Industrial Average was down 65 points, or 0.4% at 16,095. The S&P 500 declined 2 points, or 0.4%, to 1,895, led by a 1.3% fall in tech stocks.
Large losses from corporate heavyweights Apple Inc. and Boeing Company after disappointing earnings accounted for much of the drop in the Dow industrials.
Shares of Dow industrials component Boeing Inc. sank about 7% after the plane maker gave , while Apple Inc. another component, fell 5%. Apple after the company late Tuesday said since the handset’s introduction in 2007.
Opinion:
As Apple’s share price drops, Alphabet Inc. and could soon challenge for the crown of world’s most valuable company.
The Nasdaq Composite was down 44 points, or 1%, at 4,524.
“There is simply not a lot of optimism among big institutional investors this year. Every rally so far has been an opportunity to sell and overall sentiment is bad,” said Michael Antonelli, equity sales trader at R.W Baird & Co.
“Investors are perhaps thinking that problems in China and Europe are not temporary and will not be fixed easily,” Antonelli said.
U.S. crude oil which were lower in the morning, rebounded to trade 2.5% higher at $32 a barrel on Wednesday after the reported that crude inventories climbed by 8.4 million barrels for the week ended Jan. 22.
Oil prices have been extremely volatile over the months, setting the tone in stock and bond markets.
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Among other economic news Wednesday, , a signal of continued strength in the housing market.
Movers and shakers: The earnings season continues at full speed on Wednesday.
Biogen Inc. jumped 6.6% after the biotech company’s fourth-quarter .
Caterpillar Inc. slumped 1.3% Wednesday, after the agricultural equipment maker reported sharp declines in machine sales in December.
After the market closes, e-commerce company eBay Inc. telecom-equipment maker Qualcomm Inc. and flash memory chip maker SanDisk Corp. will be on tap.
Shares in VMware Inc. lost 8.2% premarket, even after the software company’s earnings late Tuesday and made good on reports of layoffs.
AT&T Inc. shares fell 1.3% after the telecommunications giant late Tuesday of analysts’ expectations.
Other markets: with the ICE Dollar Index off 0.6% while after the Federal Reserve took a more dovish tone in its policy statement.
, although China’s Shanghai Composite Index ended with losses yet again. were mainly lower, led by oil companies.
Gold eased after settling at the highest level in .
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