Stocks hold steady on Federal Reserve announcement
Stocks held near record levels Wednesday after wavering in response to the latest economic assessments by the Federal Reserve. July was still the best month for stocks since January.
The stock market was poised to end July with its biggest monthly gain in close to two years after the Federal Reserve reaffirmed its commitment to support the economy.Skip to next paragraph
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Steady growth in the U.S. economy and higher company earnings also helped the stock market hold near record levels Wednesday. The Standard & Poor's 500 rose for the seventh day out of the past eight, putting it on track to end the month with its biggest monthly advance since October 2011.
Stocks climbed after the Federal Reserve released its updated policy statement at the end of a two-day meeting. The central bank said it will keep buying $85 billion of bonds to help bolster the economy and slightly downgraded its assessment of the economy's growth in the first half of the year.
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Markets surged this month after Fed Chairman Ben Bernanke assured investors that the central bank wouldn't pull back on the stimulus until the economy had recovered sufficiently.
"It's not like the economy is accelerating so fast that they need to" ease back on stimulus immediately, said Jerry Braakman, chief investment officer at First American Trust. "It's beneficial for the stock market."
The Standard & Poor's 500 index rose eight points, or 0.5 percent, to 1,693 as of 3:24 p.m. (1924 GMT). The index has gained 5.4 percent in July, its best monthly performance since October 2011.
Stocks gained in early trading after the government said that the economy grew at a faster pace in the second quarter than economists had forecast. There was also an encouraging report on hiring ahead of the government's monthly jobs survey due out Friday.