Wall Street mostly rises as Fed holds key rate steady, with next likely hike in December
SPY•Wall Street's main indexes were little changed after the Federal Reserve held its key rate steady and upgraded its economic outlook. Markets priced an 87.4% likelihood of a 25-basis-point hike in December, up from 78.3% on Tuesday.
1. Indexes edge in mixed trading
The Dow rose 0.10% and the S&P 500 gained 0.05%, while the Nasdaq fell 0.13% after the Fed left its policy rate unchanged, as widely expected. The Fed upgraded its assessment of the economy but said inflation remains elevated. Fed Chair Kevin Warsh said the central bank had made clear its willingness and readiness to act.
2. December hike expectations climb
Markets priced an 87.4% likelihood of a 25-basis-point rate hike at the Fed's December meeting, compared with 78.3% on Tuesday. Thursday's Personal Consumption Expenditures report and advance third-quarter GDP estimate could affect rate forecasts. Earnings were also in focus: 84% of the 200 S&P 500 companies that had reported beat consensus estimates, and analysts estimated aggregate third-quarter earnings growth of 31.8% year over year.
3. Company shares diverge
Micron Technology rose 4.7% after SK Hynix reported a more-than-sevenfold increase in quarterly profit, and SK Hynix's US-listed shares gained 12.7%. Vertiv surged 16.8% after topping quarterly expectations and raising its full-year profit and revenue forecasts; Robinhood fell 3.9% after cryptocurrency weakness contributed to third-quarter profit below analyst expectations, while Boston Scientific lost 2.9% after trimming its annual profit forecast.
