Day Traders Diary
The major averages finished mixed after the Federal Reserve indicated it will keep interest rates lower over the next few years. The Dow Jones Industrial Average rose just 36 points after rallying over 300 points earlier in the day. The broader market S&P 500 fell 15 points or 0.46% while the tech-heavy Nasdaq Composite dropped 139 points or 1.2%.
Techs took the brunt of the selling with Apple dropping nearly 3%. Facebook ended the day down 3.3% and Amazon slid 2.5%. Netflix also fell more than 2%. Alphabet and Microsoft each closed more than 1% lower. A 1.4% gain in Goldman Sachs helped the Dow close positive for the session.
Members of the Fed's policymaking committee also indicated the overnight rate could stay near zero through 2023 in order to achieve its 2% inflation goal. "With inflation running persistently below this longer run goal, the Committee will aim to achieve inflation moderately above 2% for some time so that inflation averages 2% over time," the Federal Open Market Committee said in a statement.
Fed Chairman Jerome Powell reiterated the central bank's approach, telling reporters in a news conference that easy monetary policy will remain in place "until these outcomes, including maximum employment, are achieved."
The chairman also said certain areas of the economy will continue to struggle without further fiscal aid. That comment came after White House chief of staff Mark Meadows said he was optimistic about Democrats and Republicans reaching a coronavirus stimulus deal. President Donald Trump also signaled in a tweet that he would back a bigger package.
U.S. Treasuries gave up their modest gains following the release of the FOMC policy statement. The 2-yr yield increased one basis point to 0.14%, and the 10-yr yield increased one basis point to 0.69%. The U.S. Dollar Index increased 0.1% to 93.17.
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