By Anora Mahmudova and Victor Reklaitis, MarketWatch
Twitter, Yelp dive; Gilead jumps
U.S. stocks marched higher Wednesday after the Federal Reserve
offered no clear indication of the timing of the next rate hike,
but left itself room to hike rates as soon as September, citing
continued "solid" gains in the job market.
Policy makers voted unanimously to keep a key U.S. interest rate
unchanged and reiterated their dependency on data to determine
their game plan for tightening monetary policy.
Read: Federal Reserve is noncommittal on timing of first
interest-rate hike
(http://www.marketwatch.com/story/federal-reserve-is-noncommittal-on-timing-of-first-interest-rate-hike-2015-07-29)
Early action in the stock market on the heels of the report was
choppy. The main benchmarks, which were already higher Wednesday,
driven by gains in the energy, industrials and transportations
stocks, initially shot higher after the policy statement was
released at 2 p.m. Eastern Time, but indexes pared gains 10 minutes
later as investors digested the statement, only to bounce
higher.
The S&P 500 was 16 points, or 0.8%, higher at 2,109, with
all 10 main sectors trading higher. A jump in oil prices provided
support to energy stocks, while telecoms and industrials also
rallied. The Dow Jones Industrial Average rose 139 points, or 0.8%,
to 17,769.43.
The tech-heavy Nasdaq Composite underperformed other benchmarks,
weighed down by declines in Twitter and Yelp, which limited gains
for the index. Nasdaq was up 24 points, or 0.5%, to 5,113.
"Markets rose on the news and I would interpret that as dovish,"
said Michael Arone, chief investment strategist at State Street
Global Advisors' U.S. Intermediary Business.
"Market participants who were looking for any hints that the Fed
will start raising rates in September have been disappointed and
the statement was very consistent with previous ones, even in the
number of mentions of 'moderate' and 'inflation'," Arone said.
Meanwhile, companies reporting earnings on Tuesday after the
market close and Wednesday morning, delivered a mixed bag of
results. Investors rewarded Gilead Sciences Corp. and Citrix
Systems Inc. for topping estimates but punished Twitter Inc. and
Yelp Inc. in the wake of disappointing outlooks.
"We've had some good earnings reports today and transports
stocks are rising for the second day in a row, no doubt thanks to
UPS profits. We view that as a positive," Peter Cardillo, chief
market economist at Rockwell Global Capital.
"While the market has been stuck in the range, many individual
stocks have already corrected. Unless and until the S&P 500
breaks through the support or resistance levels, there is not much
chance for an upside or the downside," Cardillo said.
In other U.S. economic news, a gauge of pending home sales fell
in June
(http://www.marketwatch.com/story/pending-home-sales-fall-18-in-june-2015-07-29-109104),
pulling back from May's reading, which was the highest in more than
nine years, a trade group said Wednesday.
Movers & Shakers: Citrix Systems Inc. (CTXS) was the biggest
gainer among S&P 500 stocks, jumping 9% after the software
company's adjusted quarterly profit and revenue topped expectations
late Tuesday
(http://www.marketwatch.com/story/citrix-systems-ceo-mark-templeton-to-retire-2015-07-28-174854715).
Citrix also announced the retirement of its long time chief
executive, Mark Templeton.
Twitter Inc. (TWTR) plunged 12% in the wake of its earnings
report late Tuesday, as investors focused on the social-media
company's disappointing user growth
(http://www.marketwatch.com/story/twitter-revenue-jumps-user-growth-disappoints-2015-07-28).
Yelp Inc. (YELP) lost more than a quarter of its market value after
a quarterly report
(http://www.marketwatch.com/story/yelp-chops-forecast-chairman-to-step-down-2015-07-28)
that dismayed investors.
Gilead Sciences Inc. (GILD) rose 4% after the biotech company
late Tuesday posted adjusted quarterly profit and revenue that beat
forecasts
(http://www.marketwatch.com/story/gilead-rallies-after-earnings-beat-wall-streets-expectations-2015-07-28).
After the closing bell, Whole Foods Market Inc. (WFM) and
Facebook Inc. (FB) results are due.
Read more: MasterCard, Facebook, Humana earnings in focus
(http://www.marketwatch.com/story/mastercard-facebook-humana-earnings-in-focus-2015-07-28)
Other markets: Chinese stocks mostly closed higher Wednesday,
with the Shanghai Composite up 3.4% and recovering partly from
Monday's 8.5% slide
(http://www.marketwatch.com/story/china-stocks-remain-weak-as-investors-focus-on-the-fed-2015-07-29)
that helped spark a global selloff. But the gains baffled many
analysts, who suspected Chinese government buying. European
equities on Wednesday mostly gained ground
(http://www.marketwatch.com/story/european-stocks-step-up-as-investors-wait-for-fed-2015-07-29).
Crude-oil prices rebounded, rising nearly 3% to $48.28, while
gold and the dollar
(http://www.marketwatch.com/story/dollar-holds-steady-against-yen-euro-ahead-of-fomc-2015-07-29)
were little changed.
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