Stock Market Today: Stocks Flat as Fed Holds Rates Steady

Updated 3:35 p.m. EDT

Tariff inflation will be a issue this summer

Stocks have given up most of their gains this afternoon as Federal Reserve projections suggest slightly lower growth for the rest of the year and a bit more tariff-produced inflation. 

Nonetheless, most members of the Federal Open Market Committee see two rate cuts before the end of the year. But seven members of the committee saw no rate cuts this year. The 14-member FOMC makes the Fed's interest-rate decisions.

At 3:30 p.m. ET, the Standard & Poor's 500 Index was off 5 points to 5,978. The Dow Jones industrials were down 13 points to 42,203. The Nasdaq Composite Index had gained 14 points to 19,536.

Crude oil was higher in the afternoon after being lower most of the morning.

Fed Chairman Jerome Powell said the economy was solid but slowing a bit. The basic picture is stable. Nonetheless, he said that tariff increases will start to hit the economy later this summer and add to inflation pressures. 

Higher tariffs will affect producers, exporters, importers and consumers. "Someone has to pay for the tariffs," he said. 

Updated 2:30 p.m. EDT

Fed Holds Rates Steady

Stocks were little changed after the Federal Reserve decided to leave its key interest rate unchanged. 

The market had been higher for most of the day, although off from its highs in mid-morning. 

The Fed said it was keeping its Federal Funds Rate at 4.25% at 4.5%. Its projections of what's coming suggest that the central bank might cut its funds rate twice this year by small amounts. But there's a possibility of no rate cut at all.  

The economy is actually holding up fairly well, the Fed statement said. "The unemployment rate remains low, and labor market conditions remain solid. Inflation remains somewhat elevated," the statement said.

At 2:30 p.m. ET, the Standard & Poor's 500 Index was up 17 points to 6,000. The Dow Jones industrials were up 121 points to 42,336. The Nasdaq Composite Index was up 77 points to 21,777. 

Chairman Jerome Powell was to hold a news conference at 2:30 p.m. ET. 

The news surely annoyed President Donald Trump, who has demanded the Fed cut its key rate by as much as 2.5 percentage points and started the day by calling Powell "a stupid man."

$100 million bonuses

A fun story today is that ChatGPT CEO Sam Altman's assertion that Facebook parent Meta Platforms  (META)  CEO Mark Zuckerberg has been dangling huge signing bonuses — as high as $100 million — to lure ChatGPT workers to Meta. 

Altman made the charge on the Upcapped podcast, hosted by his brother Jack.

The figure, if accurate, is roughly five times more than the $20 million compensation package offered to Lionel Messi for joining MLS side Inter Miami, The Independent noted. 

Meta hasn't commented.  

Updated 1 p.m. ET

Stocks jumped out to sizable gains on hopes for some sort of resolution to the Iran-Israel crisis but have faded as the day has worn on. 

Crude oil and bond yields were both lower. 

At 1 p.m. ET, the Standard & Poor's 500 Index was up 19 points to 6,002. The Nasdaq Composite Index was up 94 points to 19,616. The Dow Jones Industrial Average was up 119 points to 42,335. The blue chips had been as many as 294 points right after the open.

The Nasdaq-100 Index was up 78 points to 21,797, but had been as high as 21,863. 

The fade from the early highs is probably due to the ongoing worries about where the Israel-Iran War is headed and the uncertainty about the Federal Reserve's interest-rate decision, due at 2 p.m. ET. 

The Fed is widely expected to leave its key interest rate unchanged at 4.25% to 4.5%. Chairman Jerome Powell will hold a news conference at 2:30 p.m. ET.

President Donald Trump, who really wants the Fed to cut rates by 2-to-2.5 percentage points, also derided Powell as stupid. 

In public, Iran has scoffed at President Donald Trump's demand for unconditional surrender. The president did say early Wednesday Iran had reached out to him about how to end the conflict. He offered no details. 

Crude oil was down 39 cents to $74.45 per barrel. But crude is up 30% since bottoming at $57.13 on May 5.

Housing starts were weaker than expected, the Commerce Department said. Analysts said the decline a function of buyer worries and relatively high interest rates. 

Initial jobless claims were lower than a week ago. 

Updated 11:15 a.m. ET

Stocks move higher

Stocks moved higher in the first 90 minutes. At last check, the increases were 0.54% to 6,012 for the S&P 500, 0.66% for the Dow 30 to 42,479 and 0.55% for the Nasdaq-100 to  21,849.

Leading the S&P 500 were TKO Group TKO the parent of World Wrestling Entertainment, up 4.7%, Jabil,  (JBL)  the provider of manufacturing services for electronics and other applications, up 3.7%, and Tapestry,  (TPR)  the parent of luxury brands including Coach, up 2.8%.

• Barclays has an interesting take on Nvidia  (NVDA) , as the semiconductor stalwart's stock nears a 52-week high, TheStreet's Silin Chen reports. The stock was at $143.45, up 0.9%. Its 52-week high of $153.13 was reached on Jan. 7. 

Stock Market Today

Happy Fed Day!

Will they or won't they? Actually, that's not really the question. The market is pricing in almost a 0% chance that the Federal Reserve moves on interest rates today. 

So, any move will be a huge surprise. The real question is what will the Fed say? About future moves, that is.

Look for a statement from the Fed around 2 p.m. U.S. EDT today and a news conference with Chairman Jerome Powell 30 minutes later.

This morning's economic reports include initial jobless claims and housing starts.

Jobless claims dropped to 245,000 for the week of June 14, below expectations of 251,000. While the beat is good, this is near the highest levels of the year and indicates a cooling job market.

(Normally the report comes out on Thursdays, but markets and government agencies will be closed for the Juneteenth holiday.)

Housing starts were also below expectations, which in this case is not good. Starts were 1.26 million units on a seasonally adjust basis. The forecast was 1.36 million.

Housing remains unaffordable for many Americans.

US Housing Affordability Index: Hovers near worst levels since the late 80s

Median age of a first-time buyer: From 28 to 38

From Mike Bell JPM pic.twitter.com/SDE1DP0XjG— Mike Zaccardi, CFA, CMT