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Stocks Close Lower Despite Fed Decision

Brief rally ran out of steam
By Newser Editors and Wire Services
Posted Sep 16, 2020 4:25 PM CDT

(Newser) – Stock indexes closed lower on Wall Street Wednesday after a getting a brief boost from the Federal Reserve’s decision to leave interest rates unchanged at nearly zero. The central bank also issued a less dire outlook for economic growth and unemployment. The S&P 500 was down 0.5% after having been up 0.6% following the 2pm Eastern Fed announcement. Technology stocks led the slide, outweighing gains in financial, industrial, and energy companies, the AP reports. The S&P 500 lost 15.71 points to 3,385.49. The Dow Jones Industrial average rose 36.78 points, or 0.1%, to 28,032.38. It had earlier been up more than 350 points. The Nasdaq composite lost 139.85 points, or 1.3%, to 11,050.47.

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Fed chair Jay Powell said that the economy has recovered more quickly than the Fed had expected, but he acknowledged the economic outlook remains highly uncertain, and heavily dependent on the US . getting control of the pandemic. “A full economic recovery is unlikely until people are confident that it is safe to re-engage in a wide variety of activities,” Powell said. One of the primary reasons Wall Street has roared back to record heights despite the still-raging pandemic is the immense aid from the Federal Reserve. The central bank has cut short-term rates to nearly zero and is buying all kinds of bonds to support markets.

(Read more stock market stories.)

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