NEW YORK: Wall Street stocks finished a volatile session modestly lower on Wednesday after the Federal Reserve lifted interest rates and pointed to a stronger US growth outlook following tax cuts.
The Dow Jones Industrial Average shed 0.2 percent to 24,682.31.
The broad-based S&P 500 lost 0.2 percent at 2,711.93, while the tech-rich Nasdaq Composite Index declined 0.3 percent to 7,345.29.
The Fed, as expected, raised its key lending rate, citing the improved US growth and employment outlook.
In its quarterly forecasts, Fed officials projected the benchmark interest rate would end this year at 2.1 percent after two more hikes, unchanged from the December forecast, but would rise to 2.9 percent at the close of 2019, signaling three possible hikes that year.
US stocks initially rallied on the Fed announcement, which suggested no plans to immediately accelerate the pace of tightening monetary policy.
But markets later pulled back during new Fed Chair Jerome Powell’s news conference in which he was asked repeatedly about risks to the economic outlook, including from a possible trade war between the US and China.
“Powell’s first press conference was largely uneventful, with the new chair sticking to a script similar to Yellen’s, thus sending a message of continuity despite new management,” said FTN Financial’s Chris Low.
“His answers were safe, offering little guidance on the committee’s thinking beyond what was already revealed.”
Petroleum-linked shares jumped as oil prices rallied on data showing a drop in US oil inventories. Dow members Exxon Mobil and Chevron rose 1.4 percent and 2.2 percent respectively.
Packaged food companies stumbled after General Mills warned that steepening commodity costs would dent profits. General Mills tumbled 8.8 percent while Kellogg dropped 4.0 percent, Campbell Soup 2.2 percent and Mondelez International 0.8 percent.
Tesla Motors jumped 1.9 percent after shareholders approved a pay package worth potentially billions of dollars for chief executive Elon Musk if the company meets its targets for operations and market capitalization.
Shares in the Nordstrom department store chain fell 3.3 percent as it announced that an effort by Nordstrom family members to take the company private was being terminated due to disagreement on price.
Source: Brecorder.com
