US stocks experienced modest gains on Wednesday, following the Federal Reserve's decision to maintain interest rates within the 3.75% to 4% range. This decision was made with a 10-2 vote during the Fed's two-day policy meeting. The Dow Jones Industrial Average rose by approximately 0.2%, while the S&P 500 saw a 0.3% increase. The tech-heavy Nasdaq Composite also climbed around 0.3%.
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Attention turned to the Fed's decision amidst ongoing inflation concerns, with Cleveland Fed President Beth Hammack and Fed Governor Lisa Cook dissenting in favor of a rate hike. Fed Chairman Kevin Warsh announced a change to the meeting schedule, with one fewer policy-setting meeting planned for next year, shifting one meeting to focus solely on monetary policy strategy without a vote.
The sentiment in the tech sector showed significant improvement, with both the S&P 500 and Nasdaq achieving consecutive gains. Notably, semiconductor stocks surged for the third consecutive day following a 632% year-over-year profit increase reported by South Korean memory chipmaker SK Hynix. Other industry players, including Micron and Samsung, also recorded gains.
Oracle's shares soared by 12% after it announced expectations for at least $225 billion in revenue by fiscal 2030, anticipating over 35% annual growth. As earnings season unfolds, major tech companies Microsoft and Alphabet provided updates regarding their performance and future investments in AI, with Microsoft's earnings report revealing plans to offer buyouts to 60,000 employees.
Alphabet's stock took a hit after the company reported quarterly earnings that fell short of analysts' expectations. Revenue for the third quarter was approximately $111.2 billion, slightly below the $111.3 billion forecast. Earnings per share were $2.12, falling short of the $2.99 expectation. Despite experiencing a revenue increase of 25% year-over-year to $127.6 billion, Alphabet's net income decreased significantly to $26.17 billion, down from $34.90 billion in Q3 2025.
Microsoft's stock jumped 4% after reporting first-quarter earnings of $4.89 per share on revenues of $92.28 billion, surpassing analysts' expectations. The company's cloud revenue reached $63.9 billion, exceeding predictions.
Looking ahead, traders anticipated an 85% chance that the Fed would raise its benchmark rate by a quarter point at the next meeting scheduled for December 9.
Overall, markets appeared to react positively to the Fed's steady rates and the ongoing earnings reports, with investors remaining cautiously optimistic about the economic outlook.