S&P 500 Rides Tech Rally Higher as Fed Sees Rate Hike Coming ‘Soon’ By Investing.com

By Yasin Ebrahim

Investing.com – The S&P 500 rallied Wednesday, led by a Microsoft-inspired resurgence in tech as the Federal Reserve’s signal that it could begin to lift interest rates in March was largely expected.  

The rose 1.2%. The rose 0.7%, or 225 points, and the Nasdaq gained 2%.

The Federal Reserve’s montary policy update was largely in-line with investor expectations as the central bank said it may “soon” be appropriate to raise rates, and confirmed plans to end its bond purchasing program in early March.     

“With inflation well above 2 percent and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate,” the Fed said in a statement. 

Microsoft (NASDAQ:) was up more than 4% after the tech giant delivered an optimistic outlook on revenue following better-than-expected Q2 results.

For the third-quarter, Microsoft guided revenue between $48.5 billion and $49.3 billion, compared with Wall Street estimates for $48.9 billion.

“Microsoft’s cloud guidance was stronger than the Street and when factoring in F/X headwinds we would characterize this as a blowout guide in terms of how investors will digest these numbers” Wedbush said in a note.

The bullish results from the Microsoft helped steady sentiment on growth sectors of the market including consumer discretionary following days of selling.

Tesla (NASDAQ:) rose more than 4% ahead of its quarterly results due after the market closes. Apple (NASDAQ:), which is set to report quarterly results on Thursday, was up more than 1%. 

Boeing Co (NYSE:), down 3%, failed to join in on the broader market melt up after the aircraft maker reported a wider than expected loss in Q4 and revenue fell short of estimates as the delay deliveries of its 787 Dreamliner program hurt performance.