The S&P 500 closed near the flatline on Wednesday after Federal Reserve Chairman Jerome Powell said substantial economic improvement is needed for the central bank to start dialing back its easy-money policies.
The broad equity benchmark erased earlier losses and ended the session little changed at 4,400.64.
The tech-heavy Nasdaq Composite climbed 0.7% to 14,762.58.
The Dow Jones Industrial Average dipped 127.59 points, or nearly 0.4%, to 34,930.93.
The major averages pulled back from their records in the previous session, snapping a five-day winning streak.
The Federal Open Market Committee kept interest rates in a target range near zero, reiterating its view that the economy continues to “strengthen” despite the spread of the delta coronavirus strain. Still, Powell stressed that the economy a good deal away from achieving the Fed’s dual mandates of stable prices and maximum employment.
The central bank started purchasing at least $120 billion a month in bonds and other securities in December until “substantial further progress” had been made on employment and inflation.
“Since then, the economy has made progress toward these goals, and the Committee will continue to assess progress in coming meetings,” the post-meeting statement said.
Powell noted the rising threat that the pandemic and its delta variant is posing, but he said he does not see it having a major economic impact.
“Fed’s continued patience is being cheered by the markets,” said Anu Gaggar, global investment strategist at Commonwealth Financial Network. “There was acknowledgement of continued progress towards the Fed’s goals, but there is ways to go before the Fed can be nudged to act.”
Reference: CNBC
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