By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks extended early gains after
an anxious day of trading ahead of the closely-watched Federal Open
Market Committee meeting.
In the end, the Federal Reserve stuck to its view that it will
keep short-term interest rates near zero for a "considerable time"
after the bank ends large-scale purchases of bonds meant to
stimulate the U.S. economy. Fed Chairwoman Janet Yellen is holding
a press conference at 2:30 pm Eastern.
The S&P 500 (SPX) rose 7 points, or 0.4 to 2.006.34,
hovering near its all time closing high. The Dow Jones Industrial
Average (DJI) added 45 points, or 0.3% to 17,176.41 and was above
record closing high. The Nasdaq Composite (RIXF) gained 20 points,
or 0.4%, to 4,573.12.
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Tanweer Akram, senior economist at Voya Investment Management,
said that while the Fed's decision was in line with expectations,
its subsequent decisions will still be contingent on data and the
pace of recovery in the labor market.
"The fact that there is still slack in the labor market there is
no inflationary pressure means the Fed will be cautious about
withdrawing accommodation.
In economic news, U.S. consumer prices fell in August for the
first time in 16 months, largely because of a decline in the cost
of filling up at the gas station. Separately, the U.S. current
account deficit fell to $98.5 billion in the second quarter from a
revised $102.2 billion in the first quarter, the Commerce
Department said Wednesday.
A gauge of confidence among home builders rose in September to
the highest level since November 2005, according to National
Association of Home Builders/Wells Fargo data released
Wednesday.
Stocks to watch: Auxilium Pharmaceuticals Inc. (AUXL) soared
42%, after news late Tuesday that Endo International PLC (ENDP)
will buy it for $28.10 per share in a cash-and-stock deal. Endo was
up 5%.
Lennar Corp.(LEN) rose 4.8% after posting a 47% rise in
third-quarter profit on Wednesday as higher prices and deliveries
drove up revenue.
General Mills Inc. (GIS) fell 2% after posting a disappointing
quarterly profit.
DuPont (DD) shares rose 3.8% after an investor urged a breakup
of the company.
FedEx Corp. (FDX) rose 3.7% after posting better-than-expected
profit and sales.
U.S. Steel Corp. (X) was up 10% after the company said it was
making major strategic changes late Tuesday.
Adobe Systems Inc. (ADBE) fell 3%. The software maker posted
quarterly results on Tuesday.
Rackspace Hosting Inc. (RAX) tumbled 15% after the
cloud-computing company said it won't be selling itself. (Read more
about the day's notable movers here
http://www.marketwatch.com/story/adobe-rackspace-fedex-expected-to-be-in-spotlight-2014-09-17.).
Other markets: In Asia, Hong Kong stocks broke a five-session
losing streak after a senior Chinese banking executive said the
People's Bank of China is injecting 500 billion yuan ($81 billion)
into the country's five big state-owned banks to help counter an
economic slowdown. A string of recent weak data has heightened
worries among investors.
The Stoxx Europe 600 index took inspiration from Wall Street and
China stimulus, while the FTSE 100 managed small gains ahead of
Thursday's vote on Scottish independence. Gold(GCZ4) was unable to
hang onto positive territory. Barclays cut its forecast for the
metal, citing risks skewed to the downside. Oil prices (CLZ4) were
largely unchanged.
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