U.S. stocks sank following no discernible shift in stance from the Federal Reserve amid recent market turmoil, as Apple Inc. and Boeing Co. led a slide after their outlooks disappointed investors.
The Standard & Poor’s 500 Index fell 1.1 percent to 1,883.06 at 4 p.m. in New York, after swinging between gains of as much as 0.7 percent and a 1.6 percent loss.
Fed policy makers left interest rates unchanged and said they still expect to raise borrowing costs at a “gradual” pace while watching to see how the global economy and markets impact the U.S. outlook. Since the Fed raised interest rates last month for the first time in almost a decade, turbulence in financial markets and a dimming of the outlook for global growth have spurred investors to expect a slower rise in borrowing costs.
The median projection of policy makers’ forecasts in December called for four quarter-point rate increases in 2016, while futures markets indicate traders see fewer. The probability of a raise in March has fallen to 23 percent, from even odds at the start of the year.
Anxiety fueled by China’s slowdown and a rout in oil prices has hammered stocks since the start of the year, wiping as much as $2.4 trillion from the value of U.S. equities alone. The S&P 500 remains on track for its worst January since 2009, with results from Apple Inc. and Boeing Co. offering little relief from worries that weakness in China is festering.
Equities already had a volatile day leading into the Fed’s statement, beginning with a selloff led by Apple and Boeing. Oil prices then recovered from an early drop to spark a late-morning rally in energy shares. Banks boosted the move by building on yesterday’s climb, only to shave their advance after word from the Fed.
Source : Bloomberg