NEW YORK, Oct 29 (Reuters) - The Dow and S&P 500 were slightly lower late Wednesday afternoon after Federal Reserve Chair Jerome Powell said another interest rate cut in December is far from assured. The Nasdaq was higher.
Traders also pared bets on a December rate cut, now giving it a 71% chance, down from 90% previously.
In earlier trading, stocks rose and then added to gains after the Fed cut interest rates by a quarter of a percentage point, as expected, and said it will restart limited purchases of Treasury securities.
Fed policymakers also noted the limits in their decision-making process due to the U.S. federal government shutdown. The Fed lowered the overnight benchmark rate to a target range of 3.75%–4.00%, the second time the U.S. central bank eased this year.
"Markets tend to overreact to news out of the Federal Reserve in the short term... In this case, Chairman Powell indicated that another rate cut is not a foregone conclusion," said Oliver Pursche, senior vice president and advisor for Wealthspire Advisors in Westport, Connecticut. "But no rate cut is ever a foregone conclusion. So, to me, that is not an inappropriate comment. The (Fed) is data dependent."
Helping to support the market, Nvidia (NVDA.O), became the first company to crack $5 trillion in market valuation. Its stock was last up 2.7%. It has risen more than 50% this year, leading the AI rally on Wall Street.
The Dow Jones Industrial Average (.DJI), fell 39.81 points, or 0.08%, to 47,666.56, the S&P 500 (.SPX), lost 6.44 points, or 0.08%, to 6,884.45 and the Nasdaq Composite (.IXIC), gained 76.39 points, or 0.32%, to 23,903.89.
Investors are anxiously awaiting results from several megacaps this week, with Meta Platforms (META.O), Microsoft (MSFT.O), and Alphabet (GOOGL.O), all due after the bell.
Reporting by Caroline Valetkevitch; additional reporting by Pranav Kashyap and Twesha Dikshit in Bengaluru; Editing by Shinjini Ganguli, Krishna Chandra Eluri and David Gregorio
