BUSINESS US stocks end up as Fed keeps accommodative stance

BUSINESS

US stocks end up as Fed keeps accommodative stance

AFP

06:59, July 30, 2020

Wall Street stocks finished solidly higher Wednesday as the Federal Reserve again stressed that it would maintain its highly accommodative stance and keep interest rates at zero until the economy recovers.

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File photo

The Dow Jones Industrial Average finished up 0.6 percent at 26,539.57.

The broad-based S&P 500 gained 1.2 percent to 3,258.44 while the tech-rich Nasdaq Composite Index climbed 1.4 percent to 10,542.94.

Fed Chair Jerome Powell said the central bank has seen rising evidence that the recent spike in US COVID-19 cases was weighing on activity.

He said "the current economic downturn is the most severe in our lifetimes... and it will take continued support from both monetary and fiscal policy" to achieve a recovery.

Stocks were in positive territory before the meeting, but added to gains after the Fed statement and press conference.

"The Fed's commitment to support the economy is a big part of it," said FHN Financial's Chris Low.

Investors also appeared to shrug off a congressional hearing with tech heavyweights Apple, Amazon, Facebook and Google parent Alphabet.

Although the chief executives of these companies faced tough questioning during the early going of the hearing, there did not appear to be a coalescing around specific action to penalize the giants.

All four companies gained at least one percent.

Earnings released earlier Wednesday were mixed, with Starbucks and chip company Advanced Micro Devices rising after results and General Electric and General Motors both falling.

Boeing shed 2.8 percent after reporting a bigger-than-expected quarterly loss and signaled it expects additional job cuts in light of the hit from coronavirus to the aviation industry.

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