Timothy A. Cleary | AFP | Getty Images
US stock futures were flat on Wednesday night as traders vowed to keep rates low for the Federal Reserve over the next few years.
The Dow Jones Industrial Average traded 6 points lower or 0.02%. S&P 500 and Nasdaq 100 futures were also marginally lower.
Members of the Federal Open Market Committee indicated that the US could reach the zero limit overnight through 2023 as the central bank tries to spread inflation. In a statement, the committee said: “While inflation has been consistently below this long-run target, the committee will aim to achieve inflation above 2% for some time so that inflation rises 2% over time. ”
Fed Chairman Jerome Powell reiterated this stance at a news conference, stating that easy monetary policy “will remain until these results, including maximum employment, are achieved.”
He also said that parts of the American economy would have to struggle until legislators would move forward with further fiscal stimulus. Powell’s remarks came as a struggle for lawmakers to reach agreement on a new coronovirus aid bill. Earlier on Wednesday, White House Chief of Staff Mark Meadows said he was optimistic that a deal could be reached.
Generally, the possibility of lower rates for the long term buys into equity. However, this was not the case on Wednesday.
The S&P 500 and Nasdaq both closed at the bottom and the Dow started its season well. Big Tech pulled the S&P 500 and Nasdaq, with Apple, Facebook and Microsoft all the less.
“Key indices are back in their short-term trading range following the Fed’s announcements, confirming that bulls are still not out of the woods,” said Gorilla Trades founder Ken Burman. “While nothing was scary in today’s Fed announcements, the shares reacted in a bearish fashion, especially in the tech sector.”
On Thursday, Wall Street will get the latest look at the US weekly jobless claims. US Housing Start data are also scheduled for release.
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