S&P 500 flat after Fed holds steady on rates

FILE PHOTO: A man walks by the Federal Reserve Bank of New York Building in New York City, U.S., April 26, 2021. REUTERS/Shannon Stapleton

(Reuters) – The S&P 500 was flat on Wednesday after the U.S. Federal Reserve held interest rates and its monthly bond-buying program steady and gave no sign it was ready to reduce its support for the recovery.

Despite the improving economy, the Fed repeated the guidance it has used since December, saying it must see “substantial further progress” towards its inflation and employment goals before stepping back from its monthly bond purchases.

Google parent Alphabet Inc jumped about 4% after reporting a record profit for the second consecutive quarter and announcing a $50 billion share buyback.

Both Alphabet and the S&P 500 communication services sector, which houses the company, also hit record highs.

Investors are now awaiting quarterly reports from Apple Inc and Facebook Inc after the market closes.

The Dow Jones Industrial Average was down 0.43% at 33,840.44 points, while the S&P 500 was flat at 4,186.65.

The Nasdaq Composite dropped 0.11% to 14,075.17.

Microsoft Corp’s quarterly report late on Tuesday met sales expectations and beat profit estimates, but its shares fell about 3% and pressured the Nasdaq due to skepticism about one-off benefits included in the results and high hopes after a year-long rally.

Biotech Amgen Inc’s 7% decline weighed on the Dow after it said its first-quarter sales and profit fell due to a 7% drop in its net drug prices and a hit from the COVID-19 pandemic.

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