4:05pm: Fed’s rate decision supports stocks
US stocks finished Wednesday higher buoyed by the Federal Reserve’s decision to leave interest rates unchanged at a 22-year high.
The tech-laden Nasdaq led the gains, adding 1.6% or 210 points at 13,061 points at the closing bell.
The S&P 500 was up 1.1% or 44 points at 4,238 points and the Dow Jones was up 0.7% or 222 points at 33,275 points.
Paycom Software closed 38.8% lower at about US$150 after issuing weak 2024 guidance, while chipmaker Advanced Micro Devices gained 9.8% at about US$108 on its quarterly earnings beat and optimism around its artificial intelligence growth potential.
3:05pm: Tech stocks lead rally for equities
US stocks added to earlier gains on Wednesday afternoon after the Federal Reserve voted to hold rates steady in a range of 5.25%-5.50% as the central bank waits to see how its credit tightening initiatives impact the US economy.
At 3 PM, the Dow gained 155 points to 33,208 while the S&P 500 added 31 points at 4,225 and the tech-heavy Nasdaq rose 131 points to 12,982.
Treasury yields edged lower following the Fed rate statement, with the 10-year trading around 4.8%.
In his press conference, Fed chairman Powell said economic conditions have “tightened significantly.”
12:00pm: Stocks up, bond yields fall
US stocks advanced while bond yields fell ahead of the interest rate decision by the Federal Reserve.
At midday, the Dow Jones was up 106.68 points, 0.3%, at 33,159.55, the S&P 500 was up 22.17 points, 0.5%, at 4,215.97 and the Nasdaq Composite was up 92.49 points, 0.7%, at 12,943.73.
Bond yields fell after the US Treasury announced it would continue to increase the size of its debt auctions in the coming quarters, but at a more moderate pace in longer-dated bonds.
To meet borrowing borrowing requirements, the Treasury said it planned to increase the auction sizes of the two- and five-year notes by $3 billion per month, with an increase in 10-year note auctions by $2 billion and in 30-year bond auctions by $1 billion.
There was mixed news for the jobs market with job vacancy figures coming in ahead of forecast while the ADP payroll report was weaker than expected.
9:36am: US stocks advance ahead of rate call
US stocks made steady progress in early trading, ahead of the Federal Reserve's interest rate decision later in the session.
Shortly after the opening bell, the Dow Jones Industrial Average was up 2.51 points at 33,055.38, the S&P 500 was up 5.75 points, 0.1%, at 4,199.55 and the Nasdaq Composite was up 39.97 points, 0.3%, at 12,891.21.
Craig Erlam at Oanda said: "We're seeing some trepidation in markets on Wednesday ahead of the Federal Reserve meeting later in the session and the jobs report on Friday."
"The Fed meeting should be quite straightforward, with policymakers having come out in force to soothe market fears of another rate hike from the central bank, claiming recent moves in bond markets may have done some of the job for them."
"This followed previous commentary that strongly hinted that another rate hike is likely, aligning with the dot plot from the September meeting, while warning that rates will stay high for a long time."
"With no new forecasts due today, it's all about the tone from policymakers and Chair Jerome Powell, and with bond yields still near their recent highs, I see little chance of another shift," he added.
The ADP National Employment Report showed private sector employment increased by 113,000 jobs in October, but below the FXStreet-cited market consensus of 150,000.
However, it was an improvement from last month's increase of 89,000 jobs.
"Leisure and hospitality hiring led the post-pandemic job recovery. But the industry ceded its place as the top job creator last month to education and health care," ADP said.
Estee Lauder slumped 15% after after the US cosmetics maker slashed its profit forecast, blaming slow growth in Asia and disruption from the Israel-Hamas war.
WeWork shares plunged 45% following a report in the Wall Street Journal that the shared workspace company is planning to file for Chapter 11 bankruptcy protection as soon as next week.
7:00am: US stocks seen lower ahead of Fed's interest rate call
US stocks are expected to open lower ahead of the Federal Reserve interest rate decision later in the session.
In pre-market trading, futures for the Dow Jones Industrial Average were down 0.3%, while those for the S&P 500 were down 0.3%, and contracts for the Nasdaq 100 futures fell 0.4%.
The US Federal Reserve is widely anticipated to leave interest rates unchanged at its November meeting despite strong recent economic data.
According to the CME FedWatch Tool, there is a 98% chance the central bank will leave the federal funds rate range unchanged at 5.25% to 5.50%.
At its September meeting, the Fed left rates unchanged after hiking rates by a quarter percentage point in July.
But Ipek Ozkardeskaya senior analyst at Swissquote Bank thinks “the chances are that we won’t hear anything soothingly dovish.”
“’The higher yields help us do the job’ is the best it will get,” she reckons.
Elsewhere, the first of a number of indicators on the job market will be released.
US job openings are expected to have fallen to 9.25 million in September from 9.61 million in August.
Stocks to watch include Advanced Materials Devices, down 1.7%, after it reported third-quarter earnings results which fell short of estimates, and its final quarter revenue guidance also missed consensus.
Earnings from CVS Health, Estée Lauder, Kraft Heinz and Yum Brands are due before the open, while Airbnb, PayPal and Mondelez (NASDAQ:MDLZ) report after the closing bell.