Markets
Stocks Close Slightly Higher as Fed Holds Rates in Split Vote With Two Officials Backing a Hike
Chipmakers led a modest gain on Wall Street while Treasury yields rose and traders kept betting on a December rate increase.
By Noris Ortiz ·
Wall Street finished Wednesday with small gains after the Federal Reserve left interest rates unchanged, as expected, though two policymakers voted for an immediate increase and investors quickly shifted their attention to a heavy slate of technology earnings.
At the 4 p.m. ET close, the Dow Jones Industrial Average was up 97.53 points, or 0.19%, at 52,475.10, the S&P 500 added 21.37 points, or 0.28%, to 7,743.97, and the Nasdaq Composite rose 72.04 points, or 0.27%, to 26,549.85 [1]. Stocks gave back part of their earlier advance after the decision but still ended in positive territory [2].
The Federal Open Market Committee kept the federal funds target range at 3.75% to 4% [3]. The vote was 10 to 2: Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, each preferring a quarter-point hike [3]. Reuters reported it was Cook's first dissent on a policy decision [2].
The statement described economic activity as expanding at a strong pace and said inflation "remains elevated" [3]. It noted that job gains have kept up with growth in the labor force and that the unemployment rate has changed little, and it said the committee would gather more information before deciding on the appropriate stance [3].
At his news conference, Fed Chair Kevin Warsh pushed back on the view that the economy is running too hot, saying it is "pointing in the right direction," according to Reuters [2]. He expressed confidence that inflation can return to the 2% goal without a slowdown in growth or a rise in unemployment [2].
Rate futures still pointed toward tighter policy. Pricing showed roughly an 80% probability of a hike at the Dec. 8-9 meeting, with traders slightly less convinced after Warsh spoke, Reuters reported [2]. A separate Reuters market report cited CME FedWatch data showing an 85% chance of a quarter-point December increase [1].
Bond yields moved higher. Shortly after the 2 p.m. decision, the 10-year Treasury yield was up 4 basis points at 5.025% and the 2-year yield had climbed to 4.78% before easing to 4.73% about half an hour later, according to CoinDesk's market coverage [4]. Longer-dated yields extended their rise after the announcement [2]. Bitcoin, which has tracked rate expectations closely, rose to about $81,100 by 2:33 p.m. ET [4].
Semiconductor stocks again did much of the lifting. The Philadelphia SE Semiconductor index gained 1.8% for a fourth straight advance, and Micron Technology rose 5.9% after South Korean rival SK Hynix reported a more than sevenfold jump in quarterly profit [1]. Vertiv surged 16.5% after beating quarterly expectations and raising its full-year forecasts [1]. On the downside, Boston Scientific fell 5.8% after trimming its annual profit outlook, and Robinhood lost 3.3% after weaker crypto trading pulled its third-quarter profit below estimates [1].
"The Fed didn't throw any curveballs," said Ryan Detrick, chief market strategist at Carson Group [1].
The bigger moves came after the bell. Microsoft shares rose more than 4% in extended trading following its quarterly report, while Alphabet fell more than 7% after its results [1]. Analysts expect S&P 500 companies to post third-quarter earnings growth of 31.8% from a year earlier, according to Reuters [1].
Looking to Thursday, investors will weigh how the after-hours swings in Microsoft and Alphabet carry into the regular session, and Amazon is scheduled to report third-quarter results after the market closes [5]. The combination of a Fed that has kept a hike on the table and lofty earnings expectations leaves markets sensitive to any sign that the AI spending boom is straining profits or cash flow.
Sources:
[1] Reuters via Virginia Business, "Wall Street ends higher as Fed holds key rate steady, focus turns to earnings", October 28, 2026. https://virginiabusiness.com/wall-street-rises-fed-holds-rates-steady-earnings/
[2] Reuters via Yahoo Finance, "Fed leaves rates unchanged as it awaits 'accumulation of more information'", October 28, 2026. https://finance.yahoo.com/economy/policy/articles/fed-holds-rates-steady-awaits-180301828.html
[3] Board of Governors of the Federal Reserve System, "Federal Reserve issues FOMC statement", October 28, 2026. https://www.federalreserve.gov/newsevents/pressreleases/monetary20261028a.htm
[4] CoinDesk, "Live updates: Bitcoin trading just above $81,000 as Fed delivers hold on rates", October 28, 2026. https://www.coindesk.com/business/2026/10/28/live-updates-bitcoin-climbs-above-usd81-000-as-majors-rally-ahead-of-fed-decision
[5] Barchart via Yahoo Finance, "Dear Amazon Stock Fans, Mark Your Calendars for October 29", October 28, 2026. https://finance.yahoo.com/markets/stocks/articles/dear-amazon-stock-fans-mark-142710624.html
This article was produced with AI assistance. It is for informational purposes only and is not financial advice. StockVolt and its authors may hold positions in securities mentioned.