NATIONAL NEWS

Stock market today: Wall Street rises after Federal Reserve holds steady on interest rates

Nov 1, 2023, 12:25 AM | Updated: 11:44 am

NEW YORK (AP) — U.S. stocks are rising Wednesday after the Federal Reserve opted against pressing the brakes even harder on Wall Streeet and the economy, at least for now.

The S&P 500 was up 0.8% in afternoon trading, coming off its third straight losing month largely because of higher yields in the bond market. The Dow Jones Industrial Average was up 156 points, or 0.5%, as of 2:15 p.m. Eastern time, and the Nasdaq composite was 1.1% higher.

Indexes added to their gains after the Fed announced its decision to hold interest rates steady, which was what investors expected. It’s already yanked the overnight rate from nearly zero early last year to its highest level since 2001, above 5.25%. The big question is how long the Fed will keep the rate high before cutting it to provide financial markets more oxygen.

Longer-term Treasury yields have been rising rapidly since the spring and catching up with the Fed’s overnight rate. They’ve rallied as the U.S. economy has remained remarkably resilient and the central bank has warned it may keep its short-term rate high for a long time.

The yield on the 10-year Treasury dropped to 4.80% from 4.92% late Tuesday. Last month, it topped 5% to reach its highest level since 2007, up from less than 3.50% during the spring.

High yields knock down prices for stocks and other investments while making borrowing more expensive for nearly everyone. That slows the economy and puts pressure on the entire financial system.

Yields fell Wednesday after the Fed’s statement may have given a nod to the notion that higher bond yields and shakiness in financial markets may be slowing the economy on their own without any more hikes needed.

The Fed’s statement said that “tighter financial and credit conditions” are likely to weigh on the economy and inflation. After previous rate decisions, it had cited only tighter credit conditions. Some investors are hopeful the Fed may not feel the need to hike rates anymore now that the 10-year yield has climbed as high as it has.

Earlier in the day, reports on the economy gave a clouded view. Strong reports on the economy recently have raised worries about upward pressure on inflation, even if they’re also keeping a lon g-predicted recession at bay. The Fed has been saying it plans to keep rates high because it wants to ensure high inflation is on its way back down to its 2% target.

One report from ADP suggested hiring accelerated last month by employers outside the government, though not by as much as economists expected. A more comprehensive jobs report from the U.S. government will arrive on Friday.

A separate report said U.S. employers were advertising slightly more job openings at the end of September than economists expected. The Fed has been hoping for softening there, which could take pressure off inflation without requiring many layoffs across the economy.

A third report, meanwhile, said U.S. manufacturing contracted by more last month than economists had forecast. Manufacturing has been one of the U.S. economy’s hardest-hit areas.

In the background, big U.S. companies continue to report stronger profits for the summer than analysts expected, though that hasn’t been enough in recent weeks to offset worries about higher yields.

DuPont fell 7.5% despite reporting stronger profit for the latest quarter than analysts had forecast. The chemical company gave some financial forecasts for the full year of 2023 that fell short of analysts’ expectations as it sees weakness in China and other challenges.

Estee Lauder also pointed to slower growth in China, among other factors, when it cut some of its financial forecasts for its fiscal year. The company also reported weaker revenue for the latest quarter than expected, and its stock tumbled 18%.

On the winning side of Wall Street, chipmaker Advanced Micro Devices rose 7.8% after it reported stronger profit and revenue for the latest quarter than forecast. Its revenue forecast for the end of 2023 disappointed some analysts, but it also pointed to growth in 2024 coming from the artificial-intelligence boom.

An AI-fueled bonanza earlier this year helped fuel big gains for some Big Tech stocks, with expectations high that the technology could usher in mammoth profits.

In the oil market, prices continue to swing on uncertainty about whether the latest Israel-Hamas war will affect the production and movement of crude. A barrel of benchmark U.S. oil fell 0.5% to $80.59, while Brent crude gained 0.6% to $85.49.

Oil prices recently dropped back below where they were before the Oct. 7 attack on Israel by Hamas. The region is not home to major oil production, but the fear is that the conflict could draw in Iran or other big oil-producing nations.

A barrel of U.S. oil had jumped from less than $70 in the summer to more than $93 shortly before the war.

In stock markets abroad, indexes were mostly higher across Europe and Asia.

___

AP Business Writers Matt Ott and Elaine Kurtenbach contributed.

National News

Associated Press

USPS commits to rerouting Reno-area mail despite bipartisan pushback and mail ballot concerns

LAS VEGAS (AP) — The USPS announced on Tuesday it will follow through with its plan to reroute Reno-area mail processing to Sacramento, a move that drew bipartisan ire from Nevada lawmakers while raising questions about the rate at which mail ballots can be processed in a populous part of a crucial swing state. Postmaster […]

2 hours ago

Associated Press

The Rev. Cecil Williams, who turned San Francisco’s Glide Church into a refuge for many, has died

SAN FRANCISCO (AP) — The Rev. Cecil Williams, who with his late wife turned Glide Church in San Francisco into a world-renowned haven for people suffering from poverty and homelessness and living on the margins, has died. He was 94. Williams and his wife, Janice Marikitami, who passed away in 2021, appeared in Will Smith’s […]

5 hours ago

Associated Press

Alabama lawmakers advance bill to ensure Biden is on the state’s ballot

MONTGOMERY, Ala. (AP) — The Alabama Senate voted Tuesday for legislation meant to ensure President Joe Biden will appear on the state’s November ballot, mirroring accommodations made four years ago for then-President Donald Trump. The issue of Biden’s ballot access has arisen in Alabama and Ohio as Republican secretaries of state warn that certification deadlines […]

5 hours ago

Associated Press

Transgender Tennessee woman sues over state’s refusal to change the sex designation on her license

NASHVILLE, Tenn. (AP) — A transgender Tennessee woman sued the state’s Department of Safety and Homeland Security on Tuesday after officials refused to change the sex on her driver’s license to match her gender identity. The lawsuit was filed in Davidson County Chancery Court in Nashville under the pseudonym Jane Doe by the American Civil […]

6 hours ago

Associated Press

Ex-police officer pleads guilty to punching man in custody about 13 times

BOSTON (AP) — A former Weymouth, Massachusetts, police officer pleaded guilty Tuesday to assaulting a man in his custody nearly two years ago by punching him about a dozen times without justification. Justin Chappell, 43, pleaded guilty to one count of deprivation of rights under color of law, according to federal prosecutors. U.S. District Court […]

6 hours ago

Associated Press

Douglas DC-4 plane crashes into river outside Fairbanks, Alaska; not clear how many people on board

FAIRBANKS, Alaska (AP) — A Douglas DC-4 airplane crashed into the Tanana River near Fairbanks on Tuesday, Alaska State Troopers said. It was not immediately known how many people were on board. The website www.airlines.net said standard passenger seating for a DC-4 was 44 during its heyday, but most have been converted to freighters. Troopers […]

8 hours ago

Stock market today: Wall Street rises after Federal Reserve holds steady on interest rates