LIVE MARKETS-US stocks ride the Fed seesaw to a mixed close

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U.S. STOCKS RIDE THE FED SEESAW TO A MIXED CLOSE

Wall Street closed mixed on Wednesday, haven taken its usual post-Fed roller coaster spin after the central bank did exactly what markets were expecting by leaving its key policy rate unchanged.

All three indexes closed well off their session highs. By the time the dust cleared and the bell rang, the Nasdaq .IXIC eked out a slight gain, while the S&P 500 .SPX and the Dow .DJI edged red on the day.

Tech .SPLRCT, up only about 0.4%, led S&P 500 sector gainers, while energy .SPNY and communication services .SPLRCL took up the rear.

Banks .SPXBK, .KRX and chips .SOX were among the day's outperformers.

"Stocks spiked and then came back down, and I think the reason for that is the statement is basically hawkish and no real change," Peter Cardillo, chief market economist at Spartan Capital Securities, told Reuters. "And another thing, it certainly shows that the Fed retains its independence."

The central bank left the Fed funds target rate in the 4.25% to 4.50% range but reiterated its expectations for two 25-basis-point cuts this year, while tempering expectations for further cuts going forward.

The accompanying statement says "uncertainty about the economic outlook has diminished but remains elevated," but that "the unemployment rate remains low, and labor market conditions remain solid."

Powell & Co also released an updated Summary of Economic Projections (SEP), which lowered 2025 growth expectations to 1.4% from 1.7%, upped end-of-year unemployment forecast to 4.5% from 4.2% and sees annual inflation at 3.0% by the time New Year's Eve rolls around, significantly hotter than the most current readings.

In his subsequent presser, Fed Chair Jerome Powell warned not to place much stock in the forecasts which could change as more economic data are made available. But he did warn that higher inflation is coming, just how high remains an open question.

In non-Fed news, Middle East tensions went from simmer to low boil as Iran's Supreme Leader Ayatollah Ali Khamenei dismissed President Donald Trump's demand for unconditional surrender, while neither side was clear regarding their next steps.

The market is closed on Thursday for Juneteenth, a federal holiday.

Friday's economic docket looks light, with Philly Fed and the Conference Board's Leading Economic Index on tap.

Here's your closing snapshot:

(Stephen Culp)

EARLIER ON LIVE MARKETS:

FED HOLDS STEADY, SEES 50 BPS OF 2025 CUTS; STOCKS PARE GAINS SLIGHTLY CLICK HERE

NOT THE YEAR WE WERE LOOKING FOR CLICK HERE

PRE-FED DATA POINT TO SOFTENING LABOR, HOUSING MARKETS CLICK HERE

PRE-FED DOLDRUMS CLICK HERE

LATEST FED MEET ABOUT TO GREET BENCHMARK TREASURY YIELD'S RECENT RETREAT CLICK HERE

LUXURY PRICE HIKES: WILL SHOPPERS PAY UP? CLICK HERE

A COMPLICATED PICTURE FOR UK INFLATION CLICK HERE

WATCH OIL CLICK HERE

STOXX HOVERS AROUND FLAT, MIDEAST ESCALATION KEEPS MOOD TENSE CLICK HERE

EUROPE BEFORE THE BELL: SLIGHTLY HIGHER AS MIDDLE EAST TENSION FLARES CLICK HERE