Published: Thu, September 21, 2017
Economy | By Annette Adams

Dow, S&P 500, Nasdaq edge up to new record peaks

Dow, S&P 500, Nasdaq edge up to new record peaks

Five of the 11 major S&P sectors were higher, led by a 0.58 percent gain in the financial index and 0.56 percent rise in materials index. The average is on a six-day streak of new highs.

Energy stocks were rising along with the price of crude oil early Wednesday.

Meanwhile, European stocks have moved mostly higher on the day. Bank of America rose 1.4 percent.

The Fed's projections pointed to a quarter basis point rate increase later this year, with the rate hike widely expected to come at the December meeting.

"I think the Fed has done a really good job in the past months of letting people know what they're going to do", said Bruce Bittles, chief investment strategist at Baird.

The central bank is also expected to announce plans to begin unwinding its $4.2 trillion portfolio of Treasuries and mortgage-backed securities, almost a decade after the global financial crisis. Economists had expected the index to edge up by 0.2 percent.

Among stocks, Tesla was down 1.35 percent in premarket trading after Jefferies started coverage of the electric auto maker's stock with "underperform".

The benchmark S&P/ASX 200 index fell by 53.70 points or 0.9% to 5,655.40, extending losses for the third straight session and closing at its lowest level in over seven months.

The Fed left rates unchanged for now, as was widely anticipated, but investors' expectations changed for December after the USA central bank signaled one more rate hike by year-end despite recent weak inflation readings.

Markets are pricing in a 58-percent probability of the Fed raising rates in December, according to the CME Group's FedWatch tool.

Bond yields rose following the Fed's announcement Wednesday.

At 12:33 p.m. ET (1633 GMT), the Dow Jones Industrial Average was up 44.65 points, or 0.2 percent, at 22,376, the S&P 500 was up 3.79 points, or 0.15 percent, at 2,507.66 and the Nasdaq Composite was up 9.73 points, or 0.15 percent, at 6,464.37. "The market reaction is interpreting the Fed as slightly hawkish but not too much", said Victor Jones, director of trading at TD Ameritrade in Chicago.

Western Digital slipped about 6% after Japan's embattled Toshiba said it agreed to sell its semiconductor business to a group led by U.S. private equity firm Bain Capital.

The S&P's financial sector ended 0.6 per cent higher as banks benefit from higher rates.

Many investors have been skeptical the Fed will raise rates again this year, citing subdued inflation readings and concerns around the economic toll of major summer hurricanes. The Shanghai Composite slid 0.08% and the Shenzhen Composite inched lower by 0.04%.

Shares of Apple fell 1.7 per cent after it admitted its latest smartwatch has connectivity problems.

Advancing issues outnumbered decliners on the NYSE by 1,705 to 773.

Roughly 6.7 billion shares changed hands on USA exchanges compared with the 6 billion average for the last 20 sessions.

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