Wall Street Close: A mixed day as Fed refrains from tapering hints
- US equity benchmarks closed mixed despite post FOMC recovery.
- Fed defends easy-money policy, Powell plays smart despite hesitating to discuss taper.
- Facebook earnings beat estimates but warnings of significant growth slowdown weigh on FB, PayPal misses revenue forecasts.
- US Senators ready the procedural vote on infrastructure spending, US Q2 GDP eyed as well.
Having consolidated weekly gains the previous day, Wall Street closed mixed on Wednesday as Fed played smart amid Delta covid variant woes and price pressure.
Despite matching wide market forecasts of no monetary policy change, the US central bank praised economic transition from the pandemic. However, Chairman Jerome Powell nudged the market push for the tapering hints.
Read: Forex Today: Dollar down as Fed is in no rush to taper
It’s worth noting that the cautious sentiment over whether the US policymakers back the initial step to $1.2 trillion infrastructure spending also weighs on the market.
Amid these plays, technology shares stayed on the front foot, helping Nasdaq to buck the weakness with 0.77% daily upside, by rising 102 points, to close around 14,702. Alternatively, Dow Jones Industrial Average (DJI) lost 0.36% to 34,930 and S&P 500 barely budged before ending the North American session around 4,400.
Facebook’s upbeat earnings couldn’t supersede the social-media company’s warning of a significant decline in Q3 and Q4 revenue growth on a sequential basis. Further, PayPal missed Q2 earnings and lowered Q3 guidance whereas Qualcomm benefited from strong results and the firm’s optimism for Q4. Additionally, McDonald's and Boeing were also ahead of the market expectations, as far as the latest earnings are concerned, but posted mixed closings.
It should be noted that the US Dollar Index (DXY) remains heavy near the 12-day low and the US 10-year Treasury yields stay unchanged around 1.23% by the press time, portraying the market’s indecision.
Looking forward, US policymakers’ initial reaction to the much-awaited stimulus and preliminary readings of US Q2 GDP will be the key to follow for broad directions.