S&P 500 Slips From Record High As Powell Minimizes December Cut
The S&P 500 Index has spent 125 sessions above its 50-day moving average, its longest stretch since 2011.
US stocks slumped as the Federal Reserve cut interest rates by a quarter point for a second-straight time but downplayed the prospect of further reductions before the end of this year.
The S&P 500 Index teered down 0.209% as of 2:22 p.m. in New York, while the Nasdaq 100 Index was up 0.161%. Nvidia Corp. held onto gains after breaching $5 trillion in market capitalization and becoming the first public company in history to hit the milestone.
“A further reduction in the policy rate at the December meeting is not a foregone conclusion — far from it,” Fed Chair Jerome Powell said Wednesday afternoon in the opening comments of his post-meeting press conference.
Fed officials reduced interest rates by a quarter point, as expected. In their post-meeting statement, Fed policymakers on Wednesday repeated their assessment that “job gains have slowed” and said “risks to employment rose in recent months.”
“The Fed is operating with less information than usual amid the government shutdown and is relying more on high frequency and sentiment data,” said Scott Helfstein, head of investment strategy at Global X. “The challenge is that these soft data points have continuously underestimated US economic strength over the past quarters.”
Investors are now gearing up for earnings from Microsoft Corp., Alphabet Inc. and Meta Platforms Inc. after the close. Wall Street will be monitoring updates on artificial intelligence expenditures and awaiting updates on when they expect to start seeing returns on those investments.
Positive developments on the trade front also propped up the mood among traders Wednesday. US President Donald Trump and South Korean President Lee Jae Myung finalized a trade deal, ending months of negotiation over implementation of a framework agreement struck in July.
In individual movers, Boeing Co. shares fell 4.68% after the planemaker recorded a $4.9 billion accounting charge as it delayed the debut of its 777X jetliner to 2027. Conversely, American Electric Power Inc. shares rose 5.85% after the electric utility AEP reaffirmed year operating earnings guidance range and said it expects results to be in the upper half of the range. Caterpillar Inc. shares jumped 11.34% after the machinery manufacturer reported adjusted earnings per share that beat Wall Street’s expectations.
After a 38% rally in the S&P 500 since the US benchmarks April nadir, investors face a dilemma: Cash out on their profits, or go all in. The S&P 500 Index has spent 125 sessions above its 50-day moving average, its longest stretch since 2011, data compiled by Bloomberg show. The benchmark has clocked only three longer runs in the past 30 years.
Corporate Highlights:
Boeing Co. announced a $4.9 billion accounting charge and delayed debut for its 777X jetliner, a reminder of the long recovery ahead for the US planemaker even as rising aircraft deliveries bolster its cash.
Boeing is laying plans to push production of its 787 Dreamliner to new heights, testing its ability to clear an inventory of parked planes and the strength of its strapped supply chain.
Caterpillar Inc. posted stronger-than-expected earnings and revenue on the back of surging demand from AI data centers for its power-generation equipment.
Kraft Heinz Co. lowered its sales outlook as its chief executive officer said that the feeling of US shoppers has fallen to historic a low.
Verizon Communications Inc., the nation’s largest mobile-service provider, reported gains in revenue and profit in the third quarter as a new chief executive officer laid out an aggressive growth strategy to reclaim market share.
CVS Health Corp. raised its 2025 profit guidance for a third time in less than six months, a sign that it’s set a new foundation a year into Chief Executive Officer David Joyner’s tenure following challenges in its insurance business.
Fiserv Inc. plunged after the fintech slashed its outlook for full-year earnings and unveiled third-quarter results that confounded Wall Street analysts.
Paramount Skydance Corp. began a planned round of job cuts involving 1,000 workers on Wednesday as part of an effort to slash $2 billion in costs following its August merger with Skydance Media. More cuts are expected at a later date.
Centene Corp.’s third-quarter profit surpassed Wall Street expectations and the health insurer raised its outlook, a potential sign of relief for investors after the company’s profit view collapsed earlier this year.
Caesars Entertainment Inc., a major operator of resort casinos, reported third-quarter results that fell short of Wall Street estimates.
Edison International’s executives said the company’s equipment will likely be found to be associated with triggering the deadly Eaton Fire in Los Angeles.
Uber Technologies Inc. is preparing to offer driverless rides on vehicles developed by Lucid Group Inc. and Nuro Inc. in the San Francisco Bay Area for the first time next year, thrusting the company into direct competition with Waymo’s robotaxi service.
Thermo Fisher Scientific Inc. agreed to acquire Clario Holdings Inc., a privately held maker of drug trial software, for about $8.9 billion in cash.
Online marketplace Etsy Inc. will elevate Chief Growth Officer Kruti Patel Goyal to the CEO job, entrusting the company veteran with navigating the artificial intelligence era and lifting the marketplace out of a post-pandemic slowdown.
Airbus SE is keeping its ambitious jet delivery target, setting the company up for a furious production pace to close out the year, after reporting strong quarterly earnings on the back of the defense and space unit.
UBS Group AG results failed to dispel investor anxiety about risks from previously canceled Credit Suisse bonds, the potential impact of Swiss capital reforms and the lender’s involvement in the First Brands bankruptcy, overshadowing a set of earnings that broadly beat expectations.
Deutsche Bank AG exceeded analyst estimates for fixed-income trading, giving tailwind to Chief Executive Officer Christian Sewing just a couple of weeks before he presents a new strategy.
Banco Santander SA posted third-quarter results that beat analysts’ estimates as profit jumped in the US and provisions for souring loans remained contained.
GSK Plc raised its profit and sales forecasts for the year, aided by its HIV and immunology medicines, in Emma Walmsley’s last report as chief executive officer.
Mercedes-Benz Group AG confirmed its annual outlook and plans to proceed with a €2 billion ($2.3 billion) share buyback after the company’s automaking margin climbed in the third quarter.
SK Hynix Inc. reported a 62% jump in profit and revealed it’s sold its entire memory chip lineup for next year, illustrating how a global AI infrastructure buildout is ratcheting up sector-wide demand.
Indonesia’s GoTo Group raised its earnings forecast for the year, a sign that new initiatives and cost cuts to cope with fierce competition in the ride-hailing and delivery market are paying off.
Some of the main moves in markets:
Stocks
The S&P 500 rose 0.2% as of 2:07 p.m. New York time
The Nasdaq 100 rose 0.3%
The Dow Jones Industrial Average rose 0.3%
The MSCI World Index was little changed
Bloomberg Magnificent 7 Total Return Index rose 0.7%
The Russell 2000 Index rose 0.5%
Nvidia rose 3%
Microsoft fell 0.7%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.1643
The British pound fell 0.4% to $1.3218
The Japanese yen fell 0.2% to 152.36 per dollar
Cryptocurrencies
Bitcoin fell 1.2% to $111,509.19
Ether rose 0.4% to $3,998.22
Bonds
The yield on 10-year Treasuries advanced four basis points to 4.01%
Germany’s 10-year yield was little changed at 2.62%
Britain’s 10-year yield was little changed at 4.39%
The yield on 2-year Treasuries advanced three basis points to 3.52%
The yield on 30-year Treasuries advanced four basis points to 4.58%
Commodities
West Texas Intermediate crude rose 0.7% to $60.59 a barrel
Spot gold rose 1% to $3,990.81 an ounce
