The only way to describe Wednesday’s price action is volatile. In addition, the ramp-up in volatility is not good for the long-term health of the market. In one of the wildest sessions since the early stages of the pandemic, the index started deep in the red by 40 handles, was in the green by nearly 100 handles, went red again by 55 handles, and clawed back for a small loss.
For the session, the index declined by 7.50 handles to close at 4341.50.
While the initial reaction to the Fed announcement was positive, investors did not take a liking to the question and answer session conducted by Jerome Powell afterward. Even though his answers did not deviate from the recent course the Fed has plotted for tapering and raising rates, the recent price action has investors on edge and not hesitant to sell into strength as well as into weakness.
The biggest gainer of the top components of the index was Microsoft Corp (NASDAQ: MSFT). Following a Q4 beat and raised guidance, the issue added $8.22 or 2.8% to close at $296.71.
That outperformed the cash index which declined by 0.17%.
Meta Platforms Inc. (NASDAQ: FB) was the biggest loser of the top components. The issue closed under $300 for the first time since last April by declining $5.52 or 1.8% to close at $294.63.
PreMarket Prep Stock Of The Day: AT&T (NYSE: T)
Delayed reaction to lower guidance sinks the issue. Read more about T here.