By Anora Mahmudova and Victor Reklaitis, MarketWatch
Twitter jumps
NEW YORK (MarketWatch) -- U.S. stocks finished a choppy session
slightly higher, as the Federal Reserve appeared to soothe fears
that it might start raising interest rates sooner than
anticipated.
The Fed on Wednesday said the economy is improving but
emphasized that significant slack remains in the labor market. The
central bank gave no hint of timing of the first rate hike and
repeated that it expects that to come a "considerable time" after
the end of its bond-buying program.
The S&P 500 (SPX) closed up less than a point at 1,970.08.
The Dow Jones Industrial Average (DJI) finished off session lows,
but with a loss of 31.75 points, or 0.2% to 16,880.36.
The Nasdaq Composite (RIXF) added 20.20 points, or 0.5%, to
4,462.90 as tech stocks took their cue from New York Stock
Exchange-listed Twitter Inc., which soared on stellar results.
Karyn Cavanaugh, senior market strategist at Voya Investment
Management, said stronger-than-expected ecpnomic growth in the
second quarter, announced ahead of the opening bell, confirmed that
the contraction in the first quarter was a fluke.
"The economy is growing, we are adding jobs, consumer confidence
is better and even the housing market, despite what other people
say is growing, albeit at a slower pace. In this economic
environment companies are able to grow their earnings even more,
which bodes well for markets," Cavanaugh said.
The U.S. economy sprang back to life in second quarter and
expanded at the fastest pace since last fall, fueled by a upturn in
consumer spending on big-ticket items such as cars and trucks as
well as a sharp rebound in business investment. Separately,
private-sector hiring slowed down slightly in July but remained
healthy and broad-based.
But investors initially sold stocks on fear that the stronger
economy could mean the Fed will raise rates sooner.
Twitter rules
Tech stocks shone amid a buying frenzy in Twitter (TWTR) after
the social media network's results blew past forecasts. Its shares
leapt 22% as analysts moved up price targets in the wake of blowout
results.
Among other stocks, Edwards Lifesciences Corp.(EW) jumped 10% on
strong second-quarter earnings.
But Humana(HUM) shares fell 5.6% after the health care insurer's
profit came in slightly short of expectations, but sales beat
forecasts. (Read more about the day's notable movers here:
http://www.marketwatch.com/story/twitter-amex-yelp-among-stocks-to-watch-2014-07-29.)
Spain stocks rise, Russian blue-chip index surges
European stocks closed mostly lower, while Hong Kong stocks rose
for a seventh straight session.
The Russia MICEX index of blue-chips surged more than 2% on
Wednesday, which one analyst said is because the new sanctions
don't affect the country's key gas sector. Some strategists
maintain, though, that Russia stocks remain a tricky bet in wake of
those sanctions.
In other markets, crude oil (CLU4) and gold (GCQ4) both lost
ground. The ICE U.S. dollar index, a measure of the greenback's
performance against six other currencies, was at 81.4220 Wednesday,
up from 81.2140 Tuesday.
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