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US stocks in the red by the closing bell after Fed raises rates

Chipmakers Micron Technology, NXP Semiconductors, Nvidia and Microchip Technology weighed on the Nasdaq

Wall Street
Federal Reserve decision on US interest rates dominates market action

US stocks were deep in negative territory by the end of the day after the Fed decided to raise the benchmark overnight lending rate by one quarter point to a range between 2.25% to 2.5%.

For the year ahead, the Fed said it will cut its rate hikes to two from three.

The Dow Jones Industrial Average sank more than 350 points to a new low for the year.

Intel Corp (NASDAQ:INTC), Nike Inc (NYSE:NKE), Apple Inc (NASDAQ:AAPL), and Walgreens Boots Alliance Inc (NASDAQ:WBA) were top decliners.

The S&P 500 fell around 40 points by the end of the trading day with Fedex Corp (NYSE:FDX) and Allergan plc (NYSE:AGN) among the top decliners.

The tech-heavy Nasdaq dipped nearly 150 points with chipmakers

The Russell 2000 was down about 2% by the closing bell.

Surface Oncology Inc (NASDAQ:SURF) was one of the worst-performing stocks on the small-cap index after the the biotech’s lead drug ran into some issues.

Up north, the TSX slipped more than 150 points after falling gas prices led to a drop in the annual inflation rate in November, lowering the chance of a central bank rate hike in January.

1:30 PM: Dow jumps by 200 points as investors grow bullish on Fed news

US stocks pushed higher in Wednesday’s afternoon trading session as investors took a gamble that the Federal Reserve is likely to suggest interest rate hikes will slow next year.

As the afternoon session gathered pace, the Dow Jones Industrial Average Index added 189 points to hit 23,865, powered by gains from Caterpillar, DowDuPont and IBM.

Bucking the trend was Johnson & Johnson (NYSE:JNJ), which shed 1% to hit $129.05 after the healthcare company lost its motion to appeal a verdict that grants $4.7 billion to women who attributed their ovarian cancer to asbestos in its baby powder.

Elsewhere, the tech-laden Nasdaq climbed by 19 points to hit 2,566 while the tech-laden Nasdaq rose 44 points to 6,826.

Up in Canada, Toronto’s TSX climbed 106 points to hit 14,523 while the Russell 2000 index of small-cap stocks nudged up by 10 points to 1,387.

9:56 AM: US stocks adrift ahead of Fed verdict on rates

US stocks were practically flat in early trade Wednesday as players awaited the decision by the Federal Reserve on US interest rates which are due out later in the session. 

The Fed will announce its verdict at 2 pm EDT, and that will be followed by a news conference by chair Jerome Powell 30 minutes later.

The Dow Jones Industrial Index was up 0.3% to trade at 23,759.

The S&P 500 increased 0.4% to 2,556. The tech-led Nasdaq added 0.6% to 6,824.

The Russell 2000 small cap index gained almost 0.3% to 1,381.

The CME FedWatch Tool said about 73.2% of investors are expecting the Fed to raise rates by 25 basis points.

US President Donald Trump has campaigned to get the Fed to stop further rate hikes. The Wall Street Journal editorial board backed a "pause" in rate increases.

A consumer healthcare deal between Glaxo and Pfizer was the notable deal of the session so far.

Stocks were also buoyed by news the US and China held vice-ministerial level trade talks, China's Ministry of Commerce said on its website. 

Treasury Secretary Steven Mnuchin said the two sides are planning to hold another round of talks in January 2019.

The FTSE in London was also slightly higher on Wednesday.

7:13 AM: US stock futures punch higher as D-day for Fed on rates loom

US stock futures extended their gains as markets brace for the decision by the Federal Reserve on US interest rates later on Wednesday.

The Fed will announce its keenly awaited verdict at 2 pm EDT, and that will be followed by a news conference by chair Jerome Powell 30 minutes later.

The CME FedWatch Tool said about 73.2% of investors are expecting the Fed to up interest rates by 25 basis points.

Traders said attention will be focused more on what the Fed says about its likely path on rates going forward.

US President Donald Trump has led a relentless campaign to push the Fed into stopping further rate increases, a move that has drawn support from The Wall Street Journal editorial board.

Stock futures were also boosted by news that the US and China held vice-ministerial level trade talks, China's Ministry of Commerce said on its website. No details were available.

Treasury Secretary Steven Mnuchin said the two sides are planning to hold another round of talks in January 2019.

The Dow Jones Industrial Index futures were up 0.8% to trade at 23,790.

The S&P 500 futures were also higher by 0.8% to 2,556. The tech-led Nasdaq futures also rose 0.8% to 6,516.

Only the Russell 2000 small cap index futures were off 0.07% to 1,377.

In London, the FTSE clawed its way higher ahead of the Fed decision.

The Nikkei 225 in Japan was lower by 0.6% to around 20,987. The Shanghai Composite in China dipped more than 1% to 2,549.

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