S&P 500 Turns Positive on Fed Decision

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By Yasin Ebrahim

Investing.com – The S&P 500 turned positive, as tech rebounded from session lows and the Federal Reserve announced a widely expected rate hike.

The rose 0.6%, the gained 0.6%, or 224 points, the rose 0.5%.

Tech, led by Apple (NASDAQ:), cut losses to trade higher, but sentiment on the sector remained skittish before the Fed’s interest rate decision. When announced at 2 PM ET, it confirmed the central bank’s shift to a more aggressive stance on monetary policy tightening.

“The [Fed] announcement itself is likely to be unremarkable as the market has essentially fully priced in a 50bp hike as well as an announcement of the inaugural drawdown of the balance sheet, potentially by as much as $95 billion,” Stifel said in a note.

Advanced Micro Devices (NASDAQ:) was a notable outperformer, rising more 2% after the chipmaker upgraded its full-year guidance after delivering a first-quarter beat on both the top and bottom lines.

“We’d note that this positive view comes despite AMD explicitly assuming a more pessimistic backdrop for PCs with overall market shipments now expected to dip 9%,” Wedbush said in a note.

On the earnings front, Lyft , Uber and Starbucks were among the names making headlines.

LYFT (NASDAQ:) fell more than 30% after the ride hailing company delivered softer guidance for the second quarter after reporting mixed first quarter results. The softer guidance was attributed to higher costs as Lyft said it would have to ramp-up spending to attract new drivers.

Uber Technologies (NYSE:) delivered better-than-expected results, but also flagged a $5.9 billion hit from losses on investments in Grab, Aurora, and Didi.

Starbucks (NASDAQ:), however, climbed more than 8% after the coffee chain reported a first-quarter results that topped analysts’ estimates, supported by strength in domestic same store sales.

Energy underpinned the intraday rebound as oil prices on fresh fears of supply disruptions after the European Union laid out plans to phase out imports of Russian oil.

In a sign of investor jitters ahead of the Fed decision, defensive areas of the market including utilities and consumer staples of the market were in the ascendency.