YAHOO.COM [BRIEFING.COM]: Neither
the FOMC's latest policy directive nor a key Treasury auction delivered any
negative surprises, so this session's buying effort generally went without
being thwarted. Though the major indices did fall from session highs in the final
minutes of the session, stocks still finished broadly higher.
The FOMC left its target range
for the fed funds rate unchanged at 0.00% to 0.25% and will keep the interest
rate at exceptionally low levels for an extended period. That was expected, though.
In turn, participants turned their focus to the Fed's accompanying statement,
which indicated that the FOMC expects inflation to remain subdued for some time
and economic activity is likely to remain weak for some time. The FOMC did say
sluggish income growth will constrain household spending, though members hold
the belief that economic activity is leveling out.
The FOMC also said that it
anticipates the full amount of Treasury securities will be purchased by the end
of October. Prior to the FOMC decision, the pace of purchases had suggested the
Fed would likely be done with its purchases in September.
A $23 billion auction of
10-year Treasury Notes today produced a high yield of roughly 3.73%, which is
in step with the current yield on the benchmark Note. The auction also produced
a bid-to-cover ratio of 2.49, which is right around the average for the
previous 10-year Note auctions this year.
The announcements had little
overall impact on trading, but didn't dissuade buying efforts, either. In turn,
buyers were able to cut into losses incurred in the past two down sessions.
Consumer staples stocks were
the only sector to finish lower. They suffered a fractional loss. Conversely,
financials posted the best gain by climbing 2.0%. They still have a way to go
before negating their 3.5% loss Tuesday, though.
Large-cap tech stocks garnered
support following better-than-expected earnings and strong guidance from both Applied Materials (AMAT 13.66, +0.44) and Cree (CREE 34.04, +2.21). Shares of CREE have been
given an added boost by Bank of America Merrill Lynch's decision to upgrade the
stock. Their strength helped the Nasdaq outperform its counterparts.DJ30
+120.16 NASDAQ +28.99 NQ100 +1.6% R2K +1.8% SP400 +1.3% SP500 +11.46 NASDAQ
Adv/Vol/Dec 1907/2.18 bln/782 NYSE Adv/Vol/Dec 2237/1.23 bln/813