Indexes recovered in afternoon trades and finished in positive territory Wednesday after the Federal Reserve left rates unchanged. Indexes had rallied earlier on the stock market today on hopes for a U.S.-China trade deal, but later reports said President Donald Trump will not lower tariffs to help jump-start talks. Meanwhile, Trump's latest plans lifted a couple of chip stocks.
The Dow moved up and down in positive ground before finishing 0.7% higher. Blue chips managed to break a two-day losing streak. But the Dow failed to crack its 50-day moving average.
The S&P 500 wavered between positive and negative terrain and the benchmark index ultimately gained 0.4%. The Nasdaq was down for most of the day but added 0.3% at the close. Both indexes also came off two-day losing streaks but remain above their 50-day lines.
Small caps on the Russell 2000 tested their 50-day line with a 0.3% gain.
Volume on the New York Stock Exchange and on the Nasdaq was higher compared with the same time on Tuesday. Advancers beat decliners by roughly 5-to-3 on the NYSE and roughly 6-to-5 on the Nasdaq.
Also, the Innovator IBD 50 exchange traded fund gained 0.4%. And the yield on the benchmark 10-year Treasury note fell five basis points to 4.27%.
Among stocks, Nvidia climbed more than 3% amid news that Trump may rescind a chip export curb rule that the Biden administration put in place starting in May. The last Magnificent Seven company to report earnings, Nvidia's first-quarter results are due May 28.
Super Micro Computer trimmed larger losses from earlier in the session as a result of the ruling. It was off just a little more than 1% to end the day.
3:55 p.m. ET
Powell Says Data Outweighs Sentiment
After interest rates were left unchanged Wednesday, Fed Chairman Jerome Powell responded to comments that the latest evidence in the Fed's beige book noted some layoffs. Powell said it may indicate a slowdown though it is not showing up in the data yet.
That narrative could also change since consumer spending remains healthy, though that is mixed due to a downbeat sentiment in businesses and individuals, he added. Any confirmation or change to the committee's earlier guidance for two rate cuts in 2025 will have to wait for the June meeting, Powell said.
Going back to last year's Fed gathering in Jackson Hole, Wyo., when the Fed showed concern about downside risks to the labor market, Powell said the unemployment rate has been moving sideways since then. A potential trade-off between higher inflation and higher unemployment was a bigger concern now, he said.
The possibility of a shortage in goods and higher prices due to tariffs also remains a threat though trade negotiations could temper that risk, Powell added.
Stocks Rise On Trump Chip Move; Four Big Earnings Winners Late
3:04 p.m. ET
Fed Sits Pat On Rates
The Fed decided to "maintain the target range for the federal funds rate at 4-1/4 to 4-1/2%." It noted that "economic activity has continued to expand at a solid pace," but cited continued concerns over unemployment and inflation related to effects from Trump's tariffs.
Powell noted that the committee is in a "good place to wait and see" and to let things evolve. He said that the underlying inflation picture is good, running a bit above 2%.
The risks of inflation and higher unemployment are higher, but the costs of waiting remain fairly low, Powell said. That allows the Fed to wait for tariff negotiations to play out and there is more "clarity" when their effects are beginning to be seen.
Powell said the committee could move quickly when it is appropriate and again noted there was considerable uncertainty with a lot depending on how the tariffs go. Wage participation is also at a good level, and the unemployment rate does not indicate conditions are deteriorating.
2:32 p.m. ET
Stock Market Today: Disney Soars
Walt Disney soared after the companies' earnings reports. Also, Magnificent Seven player Alphabet fell below a key level.
1:54 p.m. ET
Wood Sells Palantir; These Stocks Break Out
Elsewhere, famed investor Cathie Wood sold $41.2 million worth of Palantir, according to a website that tracks trades in the ARK Invest portfolios. Palantir stock tried to rebound Wednesday.
Palantir stock was off slightly after plummeting 12% on Tuesday. Despite the heavy sell-off, shares had gained 44% year-to-date, based on Tuesday's closing price.
Wednesday's market action saw several breakouts. Halozyme Therapeutics, part of Investor's Business Daily's Sector Leaders group, soared past a buy point of 66 after first-quarter results. In aerospace, Astronics gapped up past a 26.63 entry.
Also, Cboe Global Markets cleared a buy point at 234.37, while Verisk Analytics jumped above an entry at 306.68. Dow Jones component Travelers tested a buy point of 269.56.
12:21 p.m. ET
Stock Market Today: Google Dives On Apple News
Google-parent Alphabet fell sharply below the 50-day moving average on news that Apple reportedly will add artificial intelligence search providers to the Safari browser on its devices.
Google stock plunged 8% on the news. Apple dropped nearly 2%.
11:05 a.m. ET
China Trade Deal Talk Raises Hopes
Fueling gains earlier in Wednesday's session were reports that Treasury Secretary Scott Bessent and U.S. Trade Rep. Jamieson Greer plan to meet with China officials to kick-start talks on a trade deal. President Donald Trump recently imposed a steep 145% tariff on most Chinese goods. China retaliated with a 125% tariff.
But Bessent said Wednesday that the meeting with Chinese officials this weekend is just a beginning, not advanced trade talks. That sent the Nasdaq into negative ground and the S&P into flattish territory.
In stocks, artificial intelligence server maker Super Micro plunged more than 4% after its third-quarter results. Sales grew 19% to $4.6 billion but earnings of 31 cents per share declined 53%.
Among stocks of interest, Tesla lost ground as it tries to win back its 200-day moving average, a level of resistance since March.
Dow Jones: Disney Jumps On Earnings
On the Dow Jones index, Disney jumped more than 10% after its earnings report on Wednesday. Sales rose 7% to $23.6 billion while earnings saw a 20% increase to $1.45 per share. Shares advanced past their 50-day moving average and 200-day moving average in higher volume.
Nike and Amazon gave the Dow a lift while UnitedHealth and Boeing weighed on the index.
Stock Market Today: Arista Falls On Earnings
Earnings took a bite of more than 6% out of Arista Networks. The company said earnings rose 30% to 65 cents per share and beat views of 59 cents while sales grew 28% to $2 billion, in line with estimates. But the cloud network gear maker was cautious about the effect of tariffs on contract manufacturers.
Elsewhere, Nvidia rival Advanced Micro Devices reported sales of $7.4 billion for its first quarter, rising 36%. Earnings of 96 cents per share grew 55% from the prior year. Shares tested the 50-day moving average.
IBD Leaderboard stock Uber slipped and got turned away from a buy point at 87 after sales of $11.5 billion missed estimates of $11.6 billion. Earnings per share of 83 cents easily beat views of 51 cents.
Later in the day, Arm and AppLovin are due to report earnings at market close along with Fortinet. Shares of Arm Holdings and AppLovin have retaken the 50-day moving average. Fortinet stock is in a cup base with a buy point of 114.82.
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