Stocks were mixed Wednesday as market participants rotated out of growth stocks following the Federal Reserve's first interest rate cut since December and signaled for two more before the year's end.
The Dow Jones Industrial Average
In a widely anticipated move, the Federal Open Market Committee lowered its benchmark overnight borrowing rate by a quarter percentage point on Wednesday to a new range of 4% to 4.25% in a nearly unanimous vote, with newly appointed Governor Stephen Miran being the sole dissenter, calling for a half-point cut instead. The central bank's "dot plot" also showed that policymakers forecast for two more rate cuts this year.
"You can think of this, in a way, as a risk management cut," Fed Chair Jerome Powell said in post-meeting remarks Wednesday afternoon.
The committee wrote in its post-meeting statement that "job gains have slowed, and the unemployment rate has edged up but remains low," adding that economic activity has "moderated" while inflation "has moved up and remains somewhat elevated." Moveover, policymakers noted that "uncertainty about the economic outlook remains elevated," leading the committee to be "attentive to the risks to both sides of its dual mandate and judges that downside risks to employment have risen."
Looking ahead, policymakers are projecting for only one more interest rate cut in 2026, a move that could disappoint some investors are the market is currently pricing in an addition three reductions next year, according to CME Group's FedWatch tool.
"The FOMC threw the pitch right down the middle of the plate and gave the market virtually exactly what it expected," said Scott Wren, senior global market strategist at Wells Fargo Investment Institute, in a note to clients on Wednesday. "A cut at each of the 2 remaining meetings this year syncs perfectly with fed funds futures ... no surprise there is wide dispersion of projections for next year's policy adjustments.'
In the news, Lyft
Riders will be able to purchase a Waymo robotaxi through either the Waymo One or Lyft apps. Waymo has previously partnered with Uber
For Thursday, market participants will turn their attention towards the latest earnings reports from companies such as Darden Restaurants
