By Yasin Ebrahim
Investing.com – The S&P 500 climbed Wednesday, as the Federal Reserve kept its monetary policy measures steady, though signaled that it would begin to monitor progress toward its threshold to begin tapering monthly bond purchases at upcoming meetings.
The rose 0.23%, the slipped 0.1%, or 25 points, the was up 0.8%
“Last December, the Committee indicated that it would continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month until substantial further progress has been made toward its maximum employment and price stability goals.,” The Fed said in its statement. “Since then, the economy has made progress toward these goals, and the Committee will continue to assess progress in coming meetings.”
In the press conference that followed the monetary policy meeting, Powell said there was “more ground to make up” in the labor market to meet substantial further progress threshold to taper bond purchases.
The Fed chief also eased concerns about the economic impact of rising Covid-19 cases in the U.S. “We don’t have a strong sense how that [Delta variant] will work out, [but] there has been less economic implications from each Covid wave. [W]e will continue to monitor it carefully.”
Beyond monetary policy, an ongoing uptick in megacap tech stocks, excluding Apple, kept the broader market afloat as investors digested a raft of quarterly results from the tech heavyweights including Alphabet.
Alphabet (NASDAQ:) rose more than 3% after reporting blowout quarterly results, led by a 69% jump in advertising revenue in the second quarter, with YouTube revenue up 83% from last year.
Microsoft (NASDAQ:) was flat despite second-quarter results beating Wall Street expectations on both the top and bottom lines. The results also included guidance that was ahead analysts’ estimates, strengthening bullish calls from some on Wall Street.
“Guidance was also ahead of Street expectations and speaks to a cloud story that is just hitting its next gear in Redmond, a dynamic we still believe is underestimated by the Street,” Wedbush said in a note.
Apple (NASDAQ:) fell 1% as quarterly results that beat Wall Street expectations were overshadowed by a warning that the global chip shortage would prove a larger drag during the current quarter.
Boeing (NYSE:), meanwhile, delivered a surprise quarterly profit as the return of the air travel from the pandemic slumped boosted jet deliveries during quarter. The aircraft maker reported earnings of 40 cents per share, confounding analysts expectations for a loss of 83 cents per share.
Consumer staples and utilities, commonly used as a bond proxy given the sector’s steady dividends, were the worst performing sectors on the day as rising U.S. government bond yields dampened demand for the sectors.
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