Wall Street Sets Record, But Loses Steam After Powell's Speech
The S&P 500 briefly touched the psychological 7,000 mark for the first time on Wednesday, before losing steam and retreating from its peak as investors digested the Federal Reserve's decision to hold interest rates. The broad-market benchmark index briefly hit an intraday record of 7,002.28 after rising 0.3%, but ultimately closed trading nearly flat. The Dow Jones Industrial Average also ended flat, while the Nasdaq Composite Index managed to gain about 0.2%.
The Fed kept interest rates in the 3.50%–3.75% range. Following the decision, US government bond yields rose as the central bank's statement signaled a still-solid economic outlook: economic activity was said to be running at a "solid pace," and the unemployment rate showed signs of "stabilization." Fed Chairman Jerome Powell emphasized that it was difficult to look at the latest data and conclude that current monetary policy was "very tight."
These readings led some market participants to believe the Fed would likely remain on hold for quite some time. Jed Ellerbroek of Argent Capital Management predicts interest rates could remain at their current levels until the end of Powell's term in May. He believes the Fed is on a cautious path: inflation remains slightly higher than desired, while the risk of rising unemployment remains—so the central bank is opting for a neutral stance until data forces it to lean in one direction or another. He also added that the spotlight is now on President Donald Trump, who will appoint the next Fed chairman.
Before the market dipped, the rally was supported by gains in chip stocks following a series of strong earnings reports. Seagate Technology surged about 20% after second-quarter revenue and earnings beat analysts' estimates, with management highlighting strong demand for AI-powered data storage.
Meanwhile, ASML had previously boosted sentiment after reporting record orders and providing optimistic 2026 guidance amid the AI boom. However, its shares reversed course and erased some of their gains. As a result, the market closed the session on a mixed note: the euphoria of the 7,000 level was briefly reached, but the Fed's decision caused investors to hold back.
Source: Newsmaker.id
