US STOCKS-Wall St rally stalls late after Fed statement

Wed Nov 4, 2009 4:25pm EST
 
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* Investors eye FOMC statement on rates and economy

* Healthcare sector jumps after election results

* U.S. private sector sheds jobs at slowest pace in yr

* Dow up 0.3 pct, S&P up 0.1 pct, Nasdaq off 0.1 pct

* For up-to-the-minute market news, click [STXNEWS/US] (Updates to close)

By Chuck Mikolajczak

NEW YORK, Nov 4 (Reuters) - U.S. stocks mostly eked out a gain on Wednesday, giving back a big slice of the day's advance after the Federal Reserve reiterated its intent to keep rates low, but gave investors few new reasons to boost holdings.

Stocks pushed higher in the hour following the FOMC statement, after the Fed kept its benchmark federal funds rate unchanged in a range of zero to 0.25 percent. For details, see [ID:nN04453484] The Dow climbed as high as 9,928.04, while the S&P 500 hit an intraday high at 1,061.00 and the Nasdaq touched 2,081.00.

But the market was unable to hold those gains as it succumbed to selling pressure in the last half-hour of trading and the Nasdaq ended slightly lower.

"This doesn't change much. It's hard to figure out how this could be helpful for the upside, though it easily could have been negative," said Jordan Posner, portfolio manager at Matrix Asset Advisors in New York.

"The good news is more an absence of anything bad."

The Fed's closely watched policy statement was somewhat more upbeat than its statement in September. However, it was also more explicit about why it expects to keep rates low, citing "low rates of resource utilization, subdued inflation trends, and stable inflation expectations."

The healthcare sector jumped on hopes the Obama administration's healthcare reforms may be slowed after Republicans scored some key election victories.

The Morgan Stanley Healthcare Payor index .HMO jumped 4.7 percent, while the S&P Healthcare index .GSPA added 1.3 percent.

The Dow Jones industrial average .DJI gained 30.23 points, or 0.31 percent, to end at 9,802.14. The Standard & Poor's 500 Index .SPX edged up 1.09 points, or 0.10 percent, to 1,046.50. But the Nasdaq Composite Index .IXIC dipped 1.80 points, or 0.09 percent, to close at 2,055.52.  Continued...

 

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A street sign is seen in front of the New York Stock Exchange on Wall Street in New York, February 10, 2009. REUTERS/Eric Thayer
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