US stocks were flat on Wednesday as investors digested key technology earnings and prepared for the recent Federal Reserve policy announcement.
The S&P 500 hovered over the flatline but hit a new intraday record at the beginning of the session. The Dow Jones Industrial Average lost 140 points, hurt by a 7% decline in Amgen stock. The Nasdaq Composite was up 0.1%.
Boeing lost about 2% after posting its sixth straight quarterly loss, which also weighed on the Dow.
The Google parent alphabet reported a better-than-expected result on Tuesday after the bell, sending the tech giant’s shares up more than 4%. Alphabet saw sales grow 34% year over year.
Meanwhile, Microsoft shares fell about 2.5% even after the company beat analyst earnings. Microsoft saw the largest revenue growth since 2018, in part due to the increase in PC sales due to the coronavirus-induced shortage last year.
AMD and Visa holdings were higher after results turned out to be better than expected.
The Fed concludes its two-day meeting on Wednesday. The central bank is not expected to take action, but economists expect it to defend its policy of temporarily heating inflation. Fed Chairman Jerome Powell will hold a press conference 30 minutes after the decision is announced at 2:30 p.m. ET. These comments could move the markets.
“Any advice given in the Board of Directors’ statement or in the subsequent press conference about a possible reduction in QE – when and how quickly – would likely move both the equity and bond markets,” said Paulsen.
Tech darlings Apple and Facebook will report their winnings on Wednesday after the bell.
“Lots of FAANGs are reporting this week and the stock market can wait for some of these key reports to be released before deciding on the next major direction,” said Jim Paulsen, Leuthold Group’s chief investment strategist.
On Tuesday, the most important averages around the flatline were traded. The Dow Jones Industrial Average only rose 3 points. The S&P 500 closed flat after hitting an all-time high on Monday. The Nasdaq Composite was the relative underperformer, falling 0.34% while Tesla fell 4.5%.
Elsewhere later on Wednesday, President Joe Biden will unveil a $ 1.8 trillion new spending and tax credit plan aimed at helping families. The Biden government’s new spending plan would raise the highest income tax rate for the richest Americans to 39.6% and raise capital gains taxes to 39.6% for households earning more than $ 1 million, according to senior government officials. Stocks had taken a hit last week when reports of the tax hike surfaced.
Did you like this article?
For exclusive stock selection, investment ideas and CNBC Global Livestream
Sign up for CNBC Pro
Start your free trial now
