LIVE MARKETS-Stocks jump, S&P 500 just misses all-time closing high after Fed rate cut

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STOCKS JUMP, S&P 500 JUST MISSES ALL-TIME CLOSING HIGH AFTER FED RATE CUT

U.S. stocks whipsawed higher in the wake of the U.S. Federal Reserve's nearly universally expected rate cut decision, at which the central bank lowered its key overnight lending rate by 25 basis points.

In a typical post-Fed reaction, all three major U.S. stock indexes shot higher, retraced those gains, then bounced back as investors parsed the accompanying statement, the Summary of Economic Projections (SEP), and Fed Chair Jerome Powell's remarks at the subsequent Q&A session.

The S&P 500 teased the possibility of scoring a record closing high but fell short in the closing minutes. The blue-chip Dow came out ahead, ending the session up 1.1%.

Industrials .SPLRCI, homebuilders .SPCOMHOME, housing .HRX and regional banks .KRX were the clear outperformers.

The SEP, in conjunction with the notorious "dot plot," which provides a generalized road map of the central bank's monetary path going forward, suggested that next year one more rate cut is in the cards and the economic outlook is cautiously optimistic; while interest rates are likely to stay higher for longer than many would like, that's against a backdrop of a stronger-than-expected economy.

Still, both the statement and Powell's remarks lamented the lack of fresh official data in the wake of the recent government shutdown, leaving the door open for adjustments to policy as more economic indicators become available.

On Thursday, September trade balance data gets its overdue release, as will last week's jobless claims numbers. Economists expect initial and ongoing claims to inch higher.

Here's your closing snapshot:

(Stephen Culp)

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