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
