US stocks moved modestly higher on Wednesday after the Federal Reserve said it will begin trimming its monthly bond purchases in November with plans to end them in 2022.
The benchmark S&P 500 advanced into positive territory after the U.
S. central bank announced plans to begin tapering its bond purchases, a decision that investors had widely been anticipating as the Fed pulls back on its monetary support with the economy recovering from the coronavirus pandemic.
“The Fed did not rock the boat on this one,” said Ryan Detrick, chief market strategist at LPL Financial. “It was fairly well-telegraphed what the Fed might do and they did what most people expected.”
In afternoon trade, the Dow Jones Industrial Average fell 50.9 points, or 0.14%, to 36,001.73, the S&P 500 gained 6.92 points, or 0.15%, to 4,637.57 and the Nasdaq Composite added 64.73 points, or 0.41%, to 15,714.33.
Among S&P 500 sectors, materials and consumer discretionary led the way, rising about 0.8% apiece. Utilities lagged, falling 0.8%.
The Fed also held to its belief that high inflation would prove “transitory” and likely not require a fast rise in interest rates.
Advancing issues outnumbered declining ones on the NYSE by a 1.55-to-1 ratio; on Nasdaq, a 1.71-to-1 ratio favored advancers.
The S&P 500 posted 48 new 52-week highs and three new lows; the Nasdaq Composite recorded 197 new highs and 38 new lows.